Occupy Starbucks?

Besides being known for their ability to brilliantly sell bad coffee, Starbucks has been the recent face of abusive multinational corporations that pay little or no taxes in the UK and Europe. There are a number of multinationals that are abusing the tax system, including Apple (they pay less than 2% on profits outside of the US) but at the moment, the brunt of the hostility is focusing on Starbucks.

Maybe it’s because they have so many storefronts around the world, they are easier to target though maybe it’s because Starbucks has paid no taxes on over $630 million in sales. Starbucks, Apple and others all insist that what they are doing is completely legal and it probably is. Just as we have a dysfunctional tax code in the US, many other countries share a similar problem.

The multinationals are able to lobby for the changes or exceptions and then pay as little as possible. At the same time, many are the same companies that can’t squeeze enough out of employees and the system, while recording record high profits for the corner office team. (The UK should brace itself for another interesting exercise in taxes now that Papa Johns has brought their lousy pizza to the UK.)

It’s simply what these companies do, so there are surely many more similar stories out there. Enough is never enough and they won’t stop pushing off costs and taxes as long as they can get away with it. And of course, the political class is all too happy to let them get away with it and then some.

Whether this idea of “occupying” Starbucks will spread is still questionable but it’s an interesting start. The Guardian:

The direct action group UK Uncut plans to turn dozens of the coffee empire’s UK branches into creches, refuges and homeless shelters to highlight the chain’s tax avoidance tactics.

The announcement of the action comes on the day a Starbucks executive faces questions from the House of Commons public accounts committee over why the company paid no corporation tax in the UK during the past three years, despite senior US management trumpeting the company’s profitable operations in Britain.

MPs will also question management representatives from Google and Amazon, both of which have faced criticism for basing their European operations in countries that have lower tax rates such as Ireland and Luxembourg.

Just as they do at home, these companies can easily throw legal and accounting bodies at situations like this and pay little or nothing, as in the case of Starbucks. When they’re on the phone for earnings calls or potential (stock) purchasers they say they’re profitable but at tax time, it’s suddenly a different story.

All of this comes at a cost to society. The same society that they’re all relying on to be good consumers. The same society that has infrastructure that they all depend on as well as a stable environment for selling. Think back to the “We built this” from the campaign. Everyone needs to do their part but as it stands today, the multinationals aren’t pulling their fair share.

The cost for everyone else is going to add up and we all know who will be stuck with the bill. All of us who don’t have swarms of tax attorneys are going to be asked to pay more and more or do with less until this abuse stops. We can also guarantee that during the process, the CEOs of these companies will be whining about the freeloaders who are being paid minimum wage or asking for luxuries such as healthcare. This needs to stop.


An American in Paris, France. BA in History & Political Science from Ohio State. Provided consulting services to US software startups, launching new business overseas that have both IPO’d and sold to well-known global software companies. Currently launching a new cloud-based startup. Full bio here.

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  • A reader in Colorado

    I get sick of giving corps a special pass because they’re so cool and supposedly liberal. Or even gay friendly. Doing something good does not counterbalance or mitigate in any way doing something horribly bad. The good is good. The bad is judged by itself, not counterbalanced by whatever good. Adults understand that. At least in any other venue. It’s ethics 101. I am not redeemed as a thief, if I am a thief, by doing good for the community. So too, corporations.

    I get sick, for example, of people giving Apple a pass when they operate a third party slave factory in China because having an iPhone, in a similar manner as having a double latte espresso before work, is a mark of coolness. Or even other substantive things like being gay friendly in hiring practices.

    The one doesn’t excuse the other, any more than a person who works for charitable causes for the community is excused if he hits a child.

    There is a new sensibility. Avoiding taxes and operating foreign slave labor camps making parts is bad, profiteering off destroyed American workforce, it’s bad.

    It’s anti American. And the not paying taxes, avoiding taxes it’s bad. Even the fiduciary argument is going away. Those companies are going to be morally targeted, in addition to the more restrictive laws passed, and it’s past time they were. Even in advance of the laws, it’s past time these companies payed their patriotic American dues, and gave thanks to this land in a concrete form for the extraordinary freedom they have enjoyed for so long – the freedom that enabled their being in the first place. The very bottom rung as a big corp is paying one’s f*ing taxes and stop trying to escape them.

    And it isn’t helped by companies saying they’re for gay marriage, or whatnot. That’s a diversionary sock puppet.

    U.S. companies, they need to pay, and not avoid, their goddamn taxes, and not use exotic loopholes to avoid them. And if they don’t, they will suffer, and need to suffer, the stain of shame. All of them, evenhandedly, those valued by liberals and conservatives alike. I’m not like a right winger. I don’t hang up my values by the door when the subject claims to be “liberal”.

  • http://twitter.com/justbeamensch justbeamensch

    Coffee is OK, but corporations like Starbucks, Trader Joes and Whole Foods are projecting a consumer friendly image but are not walking the walk, they are just talking the talk. Time to step up or step off.

  • http://adgitadiaries.blog-city.com karmanot

    Hold on there! Starbucks makes great coffee, provides a cool ambient, it’s employees are terrific and the corp is gay friendly. Save your rant for the incompetent, special interest’s legislators in both countries who
    create the tax laws. Would you pay more income tax if you didn’t have to? Starbucks bashing pisses me off big time.

  • Grandpamike1

    Rebecca,

    How is it that you can see what the real, true felons are, and the majority of people in ALL nation cannot ? Is it because we are so brainwashed by media and their corporate bosses, which pound into our conscious and sub-conscious day in a day out the propaganda they are selling, that it is almost impossible to see what is happening. They make it seem that we are the problem not they until we are conditioned to accept their lies as truth and act accordingly.

    The only religion they believe in is profitability, and if you hurt them accordingly, then they will change, when profits fall, decisions change.

    I would love a worldwide embargo on companies that don’t adhere to fair profits and fair human a civil rights.

  • Naja pallida

    It’s pretty simple. Corporate entities are going to avoid paying taxes where ever and however they can. If governments don’t do something to stop it, they and the people of their country are going to be sacrificed on the altar of profit every single time.

  • A reader in Colorado

    I’m just waiting for the above named corporations to once again start whining about another tax holiday so they can repatriate their profits, tax free. This in the form of an “offer” to the American people that if they are allowed to do so, they’ll create “jobs” with their tax free money pile. Usually voiced by some corporate stooge Democrat.

  • Rebecca

    What’s wrong with this picture? The UK govt questioning a business about why they are only paying taxes required by the UK tax code. If you want businesses to pay more, *change the damn tax code*.

    Same thing here in the U.S., change the tax code. Also, raise the minimum wage to a real living wage. What so many posts about these problems are missing is that publicly owned businesses have an obligation to their shareholders. They will not do more than is required from them.

    Personally, I have no problem with that. What I want to see is regulation requiring them to do business without cheating the taxpayers or consumers. And when they go beyond what is legal, the way Bank of America got fined for *twice* in recent years, HURT THEM. Make them feel a real pain from the fine. Same with mine owners who have a history of safety infractions. If there is loss of life, their businesses should be seized.

    But the root of the problem here is NOT the businesses ppl keep ranting about. It is the legislators who are in their pocket. So, many of the problems in this country can be solved starting with campaign finance reform. Fortunately, all of the money being raised by so many small donors is going a long way to mitigating that problem. But it should be taken care of anyway. And we should play hardball on tax reform every chance we get.

    So we need to start pressuring our legislators, and make *them* pass the laws necessary to stop abuses by businesses. Now would be a good time.

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