Campaign blog

There has been a bit of a storm in a coffee cup today as it has come to light that Starbucks has paid next to no corporation tax in the UK since it opened here in 1998. Since then, the company has made over £3 billion in sales but has paid only £8.6 million in income taxes. In 2007 Starbucks' UK unit's accounts showed its tenth consecutive annual loss.

The mechanisms that Starbucks is using to achieve an overall loss in the UK are remarkably similar to those we discovered the second largest beer brewing company in the world, SABMiller, was using to avoid paying tax in a number of developing countries.

The first one is through paying royalties. Starbucks UK has to pay royalties (6% of sales) for the use of the company’s brand and business processes, money which is sent to a Dutch subsidiary based in Amsterdam. Exactly like we found SABMiller subsidiaries doing right across Africa. Once the money gets to the Netherlands it is miraculously whittled away leaving small taxable profits there too.

Another ruse Starbucks are using - just as we found SABMiller up to - is to buy the inputs for their product through a tax haven. Starbucks UK buys its coffee beans from the Starbucks roasting company in the Netherlands which in turn pays out 84% of its revenue to the part of the company that supplies the coffee beans - from Switzerland! Interesting that the tax rate on profits from trading commodities such as coffee in Switzerland is a measly 5%.

It is a scandal that these tricks allow Starbucks to avoid paying a fair amount of tax on their business in the UK. It’s also a powerful reminder that if multinational companies get away with it in the UK where we have a sophisticated revenue department and established law on this stuff, how much easier must it be for them to wipe out their tax bill in developing countries where those things are much weaker. In the UK Starbucks’ tax-free coffee is pricing out independent coffee shops, in countries like Ghana and Malawi where domestic businesses desperately need to be nurtured the same thing is going on.

Following a marathon run of conferences, last but by no means least, the Advocacy team started this week in Birmingham for the Conservative Party's annual conference.

We covered a range of topics during our time here - from biofuels to landgrabs, tax dodging to women's rights.

Our week in Birmingham started on Sunday, where ActionAid held an event on the future of renewables with the Low Carbon Partnership and Toyota's EU Director, where we called for an end to the use of food for fuel in the production of biofuels. Our own biofuels supremo Tim Rice delivered our side of the story on the need for alternatives to biofuels, on which more can be found here. The distinguished former leader of the House of Commons Sir George Young MP, the leader of the Conservatives in the European Parliament, Martin Callanan MEP as well as Lord Borwick attended among others. At the same time, at the other end of the building, one of us was putting our case on biofuels to Greg Barker MP, the Energy Minister.

We were also pleased to have with us on Sunday and Monday David Barissa Ringa from ActionAid Kenya whom we took to various events to speak about biofuels. David is one of ActionAid’s leading experts on food security and land rights and has first-hand experience of dealing with the impacts of biofuels on communities and the local environment. Having him really made a difference, and it is clear that his first hand testimony on the impact that the use of food for fuel is having on communities in Africa was extremely powerful and effective.

On tax, we had really constructive discussions with think tanks, among which CFID (Conservative Friends of International Development), Bright Blue (a leading progressive conservative think tank), and the Conservative Policy Forum in charge of developing conservative policy.

Finally, yesterday we hosted a really great reception with the Conservative Women's Organisation (CWO) and Dods to launch the Women in Public Life Awards and celebrate the work of our Parliamentary Network on Women’s Rights in Afghanistan. After our own Campaigns, Policy and Advocacy Director, Beverley Duckworth, delivered a fantastic speech on the need to keep the fight on for women's rights, a leading and increasingly influential MP, Margot James, took the stage.

Margot praised ActionAid and had very warm words for our work on women's rights in Afghanistan. Margot and the CWO all promised to remind David Cameron of his role to press for women's rights internationally, as much as domestically.

On Tuesday morning in her speech, the new Secretary of State for International Development Justine Greening MP spoke passionately of the need to put women front and centre of development. She also expressed the need to help countries graduate from aid dependency, language that comes directly from our Real Aid 3 report. It is exciting to see that so much of what we have been pushing for is having a real impact on DFID's.

But we still have a lot to do. So we will continue to press ministers on our issues and a lot of follow up is waiting for us when we are back in Westminster.

Voilà, that is all from the Advocacy Team for now. Our tour of the party conferences is over - and we look forward to following up on the work we've done!

Today we’re celebrating ActionAid’s 40th birthday in style at a jam packed event with over 15 speakers from all over the world. David Barissa Ringa is here to tell us how he campaigned with communities to stop 50,000 ha of land being grabbed to grow biofuels in Kenya. And Asgar Ali Sabri, Director of ActionAid Programmes, Policy and Campaigns in ActionAid Bangladesh will be filling us in on how they work with communities to fight poverty and injustice.

Take part and see what's going on by following #ActionAid40 (or check out the feed below) and Tweet to @ActionAidUK with your questions and comments!

I recently met one of our campaign supporters who was helping out on a campaigns stall to promote the biofuels campaign. During the course of the afternoon we got talking and he told me how he’s taken up writing poetry and was working on a poem about ActionAid. Well a few days later this tour de force popped into my inbox. It does such a great job of capturing what we do, so in the spirit of National Poetry Day, I thought I would share it here.

ACTIONAID HELPS By Cliff Bevan

Somewhere in the world’s unseen
People live both gaunt and lean
Crops are grown in wasted fields
They toil all day for smallest yields.

Without rain these people starve
While all remote a living carve,
Then a famine will befall
Some will die, out goes the call.

Charities such as ActionAid
Find someone where cause is laid
Make a noise to spread the word
Try to make their message heard.

They need some help from Western lands
Where well off folk do’nt dirty hands,
Money’s wanted for support
Pass their right of being taught.

They supply the knowledge farmers need
And Aid, like handing out the seed
Which means that they can grown their own
A better life by what is grown.

But sometimes it is out their hands
As company’s take away their lands
For biofuels, which governments bless
And conglomerates plant with no redress.

The food that’s used to keep them whole
Drives western cars to reach a goal
And taxes do not reach the poor
As lawyers find a hole in law.

Tax havens take so much away
So companies find they need not pay,
The Budgets and the future bills,
At last it’s seen that power kills.

It all makes life out there so hard,
They need to fight, be on their guard,
With charity’s aid to publicise
And bring the facts to Western eyes.

So join this group of forty years
That try’s to take away the tears
Of children hungry in their bed
Who without help would not be fed.

So pay your taxes when their due
To countries who have much to do
And keep the land for folk to feed
Not taken up for pointless greed.