Starbucks promises to pay more UK tax

Updated 07 December 2012
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Starbucks promises to pay more UK tax

LONDON: Starbucks bowed to mounting pressure over its tax affairs in Britain and revealed that it would pay about 10 million pounds ($16 million) in each of the next two years.
Having been slammed by the country's lawmakers of "immorally" avoiding tax, Starbucks' UK managing director Kris Engskov said the firm had agreed to pay more than required by law.
"With the backdrop of these difficult times, in the area of tax, our customers clearly expect us to do more," he told the London Chamber of Commerce.
The Seattle-based coffee company has 700 British outlets, but has paid just 8.6 million pounds ($13.8 million) in corporation tax in 14 years. Starbucks Corp. says this is due to a process involving paying royalties to its European headquarters in the Netherlands.
The company hasn't done anything illegal. Companies operating in Europe can base themselves in any of the 27 European Union nations, allowing them to take advantage of a particular country's low tax rates.
Earlier this week, Parliament's Public Accounts Committee criticized multinationals such as Starbucks, Amazon and Google for "using the letter of tax laws both nationally and internationally to immorally minimize their tax obligations."
Starbucks, which also has been the target of demonstrations by the protest group UK Uncut, announced this week that it was reviewing its tax approach.
Engskov said the company was proposing "to pay a significant amount of corporation tax during 2013 and 2014 regardless of whether our company is profitable during these years."
He estimated that would amount to "somewhere in the range of 10 million pounds in each of the next two years."
Labour lawmaker Margaret Hodge, who chaired the parliamentary committee, said Starbucks' change of heart was proof that "people power works."
Earlier this week, UK Treasury chief George Osborne earmarked an extra 77 million pounds ($124 million) to clamp down on "offshore evasion and avoidance by wealthy individuals and by multinationals."


Samsung Electronics reports 52% jump in Q1 net profit

Updated 26 April 2018
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Samsung Electronics reports 52% jump in Q1 net profit

  • Profits bump thanks to strong demand for memory chips, smartphones
  • Net profit for the January to March period hit 11.69 trillion won ($10.8 billion)

SEOUL:  Samsung Electronics reported a 52 percent jump in its first quarter net profit Thursday, thanks to strong demand for memory chips and its latest flagship smartphone.
Net profit for the January to March period hit 11.69 trillion won ($10.8 billion), up from 7.68 trillion won a year earlier, the company said in a regulatory filing.
Operating profit was a record 15.64 trillion won, in line with the estimate of 15.6 trillion won suggested in a preliminary guidance report released earlier this month.
“The semiconductor business posted solid earnings — 11.55 trillion won in operating profit on a 20.78 trillion won revenue — on strong demand for memory chips,” the company said in a statement.
Total sales grew 19.8 percent to 60.56 trillion won and Samsung expects the memory business to maintain its strong performance in the second quarter.
But generating overall earnings growth across the company will be a challenge due to weakness in the display panel segment and a decline in profitability in the mobile business in the face of rising competition, it said.