Alliance Boots comes under fire over corporate tax avoidance
Pharmacy giant Alliance Boots has been accused of using a legal loophole to avoid paying £1.1bn in tax in the UK.
In a new report trade union Unite and the charity War on Want claim that after private equity bosses borrowed £9bn to buy Boots in 2007 they used interest due on the huge debt to cut UK tax bills by 95%.
An official Boots statement in response to the allegations says that the company “fully complies” with UK law and paid more tax last year than before the 2007 buyout.
Demanding the tax loopholes be closed, Unite General Secretary Len McCluskey commented: “Tax avoidance is now part of the DNA of a corporate British culture that is rotten to the core. The revelation that yet another high street name fleeces Britain, taking work from our NHS while avoiding tax responsibilities, will leave taxpayers furious.”
Associate director of retail initiatives Nell Geiser, from Change to Win, the federation of US trade unions added: “After avoiding millions in UK tax through massive borrowing, Alliance Boots’ private owners are selling out and stand to profit handsomely. Corporate tax avoidance is not going away unless we shine a light on it and unless policy-makers act decisively.”
However the Boots statement questioned some of the accuracy of the report and highlighted the fact that neither Unite nor War on Want contacted the company during the preparation of their report or subsequently: "We have published a detailed Annual Report on our website containing comprehensive information on both our tax charge and tax paid. In recent years this has included details of our tax charge and tax paid between the UK and other countries in line with evolving best practice."
A string of multi-nationals have been accused of using legals loopholes to avoid UK taxes in recent years, including Starbucks, Vodafone, Google, Facebook and Apple.
You can read the War on Want report in full here.