Business Insider and Law 360 cover CICTAR’s latest report on Starbucks

“Starbucks’ reputation for being conscious of its role in society contrasts with its use of tax loopholes”, said Jason Ward, principal analyst at The Center for International Corporate Tax Accountability and Research (CICTAR) quoted in a report by ‘Business Insider’ on CICTAR’’s latest research.

CICTAR’s research finds that ‘Starbucks likely avoided taxes on $1.3 billion in profit using a Swiss subsidiary’.

Starbucks uses Switzerland-based SCTC to book the cost of the unroasted coffee beans, even though the beans don't appear to move through Switzerland, then sells the exact same green coffee beans at a higher price to other entities in the Starbucks corporate structure. Profits from those markups are taxed at a significantly lower tax rate than if they had been booked in the United States or other countries.

"It's not like they're roasting coffee or researching the different types of beans or anything," Ward said. "There's nothing like that going on there."

Kevin Pinner at Law 360 Tax Authority particularly notes 'the use of Starbuck’s private certification program for coffee growers to boost profits transferred almost tax-free from Switzerland to the Netherlands to the U.K., amounting to an estimated $1.3 billion'.

The report has also been noted and linked by the Institute on Taxation and Economic Policy (ITEP) here with a great thread and analysis from ITEP’s Matt Gardner here.