LRC | >Re-PHOTO

UK Uncut At Starbucks – On Saturday 8th December 2012 UK Uncut protested at over 45 Starbucks coffee shops across the UK against their failure to pay their proper share of tax.

They were also in protest against the government’s continuing refusal to close loopholes and cut down on tax avoidance and the harsh impact of government cuts on women.

UK Uncut briefly transformed the branches of Starbucks into women’s refuges, crèches and homeless shelters, which elsewhere in many places are having to close because of the cuts which would not be necessary if companies like Starbucks paid tax properly on their UK earnings.

I photographed the protests at three Starbucks branches, beginning in the West End at Conduit Street. Here a quarter of an hour before the protest was due to start there were already police, press and a few demonstrators outside.

A Starbucks employee was standing by the door and refusing entry to those he thought likely to be protesters, but I was not stopped and joined the queue. There were others in front of me who I thought were probabably UK Uncut supporters as well as some already seated and drinking coffee.

The queue moved slowly towards the counter and by noon when the protest was about to start I was in danger of being served, but was saved from bad coffee as one of the protesters got up and started the protest.

She read a lengthy document about Starbucks’ failure to pay tax, and how the amounts that companies including them were avoiding paying were around five times the total of the cuts in services so far made by the coalition government. Then she announced that they were setting up a crèche inside this branch to compensate for all those and other family services that the government had closed.

Starbucks staff locked the door and the protest continued with more speeches and chanting calling for Starbucks to pay up. It was a family-friendly protest with some babies and young children in families taking part and there was only any argument when staff stopped a couple of the protesters from putting their banner up in the window.

Around ten minutes later a police officer arrived and wrongly accused the protesters of behaving in an intimidatory manner towards the staff and customers. They had behaved politely and there was clearly no intimidation, and they had not even been asked to leave by the store manager.

Despite this, the police told them this very well ordered protest was a disorderly protest and that they would be arrested unless they left, though he failed to say under what law.

Customers who were not protesting – though some had been interested by the protest and asking to know more about Starbucks failure to pay taxes, along with some of the protesters and some of the press, myself included, then left the store, walking through a large and noisy protest by those who had not managed to gain entry earlier.

The protest inside continued, and in the next five minutes or so that I was outside there appeared to be no arrests. But I decided then to take the short walk to the Vigo Street Starbucks to see what was happening there.

The Vigo Street protest had also begun at noon and although I was unable to go inside I was able to photograph the ‘Women’s refuge’ that had been set up through the large glass windows, as well as the large crowd protesting outside. A few minutes later, having been inside for over half an hour the protesters inside walk out to take part in the rally outside.

Here we were told some of the tricks that Starbucks uses to avoid tax. One is to use a Starbucks company in a tax haven to lend them money at 4% above the LIBOR rate to fund their UK operations. This excess interest reduces the profit of the UK company but transfers large amounts to them in the tax haven. They also buy their coffee beans at inflated prices from a subsidiary in Switzerland which reduces the tax they pay from 24% to 5%, and pay 6% of their sales as a royalty to their Dutch company which has a secret low rate tax deal with the government there.

Tricks like these used for corporate tax avoidance are caluclated to cost the UK £70 billion in lost tax revenue – far more than the £15 billion of benefit cuts.

Later in the day I went to the Euston Road branch of Starbucks where the Labour Representation Committee together with UK Uncut briefly occupied the store.

The LRC at the 2010 Labour conference had put forward a motion calling on the party to mount a campaign to highlight tax avoidance which had been passed overwhelmingly but so far the party had failed to take action. It now seems unlikely that should we get a Starmer government any real moves will be made in this area.

The LRC had called for the action to take place at 2pm, but when they had failed to show up fifteen minutes later the UK Uncut supporters went in and began to occupy. Some people from the LRC arrived shortly after but by then Starbucks staff had locked the doors and they were unable to enter.

Police arrived and came and talked politely with staff and protesters who agreed they would leave and continue the protest outside when they were requested to do so – which shortly after they did.

More had now turned up for the protest which continued for around half an hour outside the store.

More on My London Diary:
UK Uncut Visits Starbucks
Starbucks Euston Road – LRC

I’ve been a coffee drinker most of my life, and there was a time long ago in my late teens when breakfast meant a large mug of black coffee, a cigarette and Miles Davis. And though I gave up smoking when I reached majority (which was 21 back then) I still have the black coffee though now with rather more carbohydrate in muesli and a slice of homemade brown bread. And since my wife and I have rather different musical tastes we listen to the news.

The coffee I drink now is a Fair Trade blend from Traidcraft – they have a range of ground coffees and most are good, though your taste may vary. With a small metal filter that sits on top of a mug its almost as quick as using instant coffee, though I usually have a cup of that (also fairly traded) when I finish writing these posts in the morning.

*Journalist Polly Toynbee (right) was among the protesters*

Back in the last century when I was making long walks around London, often in the suburbs, on the winter days I preferred I always took with me a Thermos of strong black coffee. Back then coffee shops were rare, and if you could find it, coffee bought on the streets unreliable. My top priority back then in choosing a camera bag was whether I could fit the flask in.

But since then I have occasionally bought a coffee (though it pains me to pay £3 for something I could make better at home for 30p), but have avoided Starbucks – because they don’t pay their taxes. Of course the are not unique in this, but they are one of the best known of tax avoiders, and had then paid no tax in the UK since 2009. So when I joined the longish queue inside the Conduit Street Starbucks on Saturday 8th December it was I think my first time, and I was rather hoping that the protest would begin before I reached the counter.

“As noon approached, there were more protesters and photographers standing around inside the store, as well as some seated drinking coffee. Around a minute after noon, one of the protesters got up and started the protest, reading out a lengthy document about Starbucks’ failure to pay tax, and how the amounts that companies including them were avoiding paying were around five times the total of the cuts in services so far made by the coalition government. She announced that they were setting up a crèche inside this branch to compensate for all those and other family services that the government had closed.”

“The protest continued with more speeches and some chanting of slogans calling on Starbucks to pay up. After around 10 minutes a police officer came into the branch and wrongly accused the protesters of behaving in an intimidatory manner towards the staff and customers, which they clearly had not. Nor had they been asked to leave by the store manager. But they were told this was a disorderly protest despite this, and threatened with arrest if they stayed, although at no point did he make clear under what law they might be arrested.”

“The protesters allege that Starbucks uses a whole number of tricks to avoid paying tax. One is to use a Starbucks company in a tax haven to lend them the money to fund their UK operations at a rate 4% above the LIBOR rate – the excessive interest costs the UK business but makes fat profits for them in the tax haven. Another is to buy their coffee beans at high prices from a subsidiary in Switzerland, which pays only 5% tax on them rather than the 24% they would pay in corporation tax in the UK. They also pay 6% of their total sales as a ‘royalty’ to their Dutch company – and they have a secret low rate tax deal with the government in the Netherlands.”

“Several of the speakers talked about the real hardships being faced particularly by women and the disabled in the UK because of the cuts in services. The losses in tax through tricks like those they say are used by Starbucks – Corporate Tax Avoidance – costs the UK £70 billion, which they compare to the benefit cuts of £15 billion.”

I left with the protesters after the police threats, when they continued to protest with a large and noisy crowd who had been unable to get inside, and walked the short distance to Vigo Street, where another protest was taking place inside and outside the Starbucks branch there, and I took more pictures through the large windows and on the street outside.

Later I went to another Starbucks protest at the Euston Road branch, a part of the UK Uncut Day of Action against Starbucks arranged by the Labour Representation Committee (LRC). I found a small group of UK Uncut supporters at the meeting point but there was no sign of the LRC, and after 15 minutes the action began without them as a dozen or so people walked into the branch, took out a poster and began the action. By the time the LRC arrived the doors were locked and they protested outside. A couple of police officers then got out of their van on the opposite side of the road and walked across and were admitted into the coffee shop. There were a few minutes of polite and friendly conversation and the protesters then walked out to join those protesting outside.

The protesters point out that Costa Coffee who have a lower annual turnover than Starbucks in the UK were paying each year “several times per year what Starbucks are offering to cover several years of dubiously legal tax avoidance. Starbucks have avoided paying perhaps ten times what they are now offering.”

Now its time for a coffee.

Tag: LRC

UK Uncut At Starbucks – 2012

Visiting Starbucks