Starbucks made news when they volunteered to pay extra UK tax in order to help alleviate public criticism of their brand, and even in the face of the increased taxes are reporting that they are starting to reform their UK business and are making progress. They did not however announce how they plan to turn the chain around so that they increase their profits in the UK.
Chief Financial Officer Troy Alstead of Starbucks stated that as they head into the next few quarters they are confident that the chain will be in a much better place but he did not offer any specifics about how they would do so.
In the past Starbucks has defended their low UK tax bill by stating that their business has been losing money in the UK and this is why they have not been paying more, but last year it received a great deal of criticism from the public and many politicians when the low tax bill was actually made public. In attempt to regain some standing in the country Starbucks paid £5m in corporate taxes in the UK which is the first time that it has made a tax payment since 2008.
Towards the close of 2012 it finally caved and pledged to make tax payments that at the moment are actually voluntary since the business is not making enough in profits in order to actually be taxed at a high corporate task.
Alstead remarked that the tax issue is still a major concern for Starbucks because they are aware that the issue is a large to their customers and they are always very conscious of how customers perceive their company. He added that they hope that the taxes will prove that they are responding to their concerns.