Reuters (London) has reported that coffee chain Starbucks said it could voluntarily pay about £20m in corporation tax in Britain over the next 2 years. “We are making a commitment that we will propose to pay a significant amount of corporation tax during 2013 and 2014 regardless of whether our company is profitable during these years,” Starbucks UK managing director Kris Engskov said in a speech.
Reuters said one of the tax-deductible costs weighing on Starbucks’ British business has been the royalties paid to an Amsterdam-based Starbucks company for the use of intellectual property, such as the brand. “In 2013 and 2014, Starbucks will not claim tax deductions for royalties or payments related to our inter-company charges,” Mr Engskov told an audience at the London Chamber of Commerce. In doing so, Starbucks would contribute about £10m pounds in tax each year, he said, meaning that the company would pay more than is required under British tax law. He said he had not yet discussed the proposal with UK tax authorities. UK HM Revenue and Customs (HMRC) said corporation tax was not a voluntary tax and Parliament set out the rules and rates for businesses to follow.
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