The SABMiller guide to tax dodging

We’ve found that Grolsch’s owner, SABMiller, is dodging its taxes around the world.

The money that African countries lose each year could put an extra 250,000 children in school.

Grolsch would have you believe it’s as Dutch as tulips and clogs, but it’s actually owned by one of the biggest multinationals in the beer business. Grolsch’s owner, SABMiller:

  • Is the 2nd biggest brewer in the world and number 1 in Africa
  • Owns over 200 brands, including Grolsch, Peroni, Castle and Miller
  • Makes profits of £2 billion a year
  • Has its HQ just off Park Lane in London

SABMiller has a massive 65 tax haven companies, more than it has breweries and bottling plants in Africa. Tax havens enable the SABMiller group to use clever accounting to siphon profits out of Africa, taking desperately needed money away from poor countries.

ActionAid estimates that it is ripping off poor countries in Africa to the tune of £20 million a year

Step 1 - Going Dutch.

Many of the ‘local’ beer brands SABMiller sells in Africa (like Castle, Chibuku and Stone) are owned in the Netherlands.

African bits of SABMiller pay millions in ‘royalties’ to Dutch bits of SABMiller for the use of these local brands. So a large chunk of the profits are officially made in the Netherlands, rather than in the countries where the beer is brewed, sold and drunk.

Estimated tax loss to African countries: £10 million per year.

Step 2 - The Swiss role.

In this second tax dodge, SABMiller’s African and Indian subsidiaries pay whopping ‘management service fees’ to sister companies, mostly in Switzerland. Once again, the profits get made, and the taxes get paid, in a tax haven rather than the developing country where the beer was produced and sold. A SABMiller employee at the Swiss office address that receives millions of pounds each year from Africa for management services told us. The company admits that these payments are routed through tax haven companies, which contract out the services to other companies elsewhere

We don't do that kind of thing here, we're just the European head office

The company admits that these payments are routed through tax haven companies, which contract out the services to other companies elsewhere.

Estimated tax loss in Africa and India: £9.5 million.

Step 3 - Take a trip to Mauritius

How would you ship goods from South Africa to Ghana? Any geography student would tell you to turn right from the Cape and head up Africa’s west coast.

And that’s what happens to the raw materials Accra brewery, Ghana, imports from South Africa. But for some reason, all the paperwork takes place on the tiny island of Mauritius, 5000 miles away in the Indian Ocean. Could it be because Mauritius has such lovely beaches? Or maybe it’s because it’s a well known tax haven.

Estimated tax loss in Ghana: up to £670,000

Step 4 - Thinning on top

In this final dodge, Accra Brewery borrowed money from Mauritian subsidiary MUBEX. By offsetting interest payments against tax, less tax is paid in Ghana.

Estimated tax loss in Ghana £76,000

 

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