Alliance Boots, the owner of Boots the chemist, has avoided £1.1bn in taxes by routing its cash through a series of subsidiaries in well-known tax havens including Luxembourg, Cayman Islands and Gibraltar, according to a new report.
The campaign groups War on Want and Change to Win and the Unite union have calculated that the company saved the money by loading the UK business with debts from its £12.2bn private purchase in 2007 and legally claiming tax relief against the interest.
The campaigners claim that 40 per cent of Boots’ sales come from NHS-funded services such as prescription drugs and flu jabs – and called on the Government not to hand contracts to companies that do not pay their fair share in tax. The pharmacy giant rejected the report’s findings and said it is one of the most transparent private companies in the world. Only 25 per cent of sales came from prescriptions and similar business, it added.
Last year, Alliance Boots’ sales hit £22.4bn with underlying profits reaching £805m. However, the company paid just £114m in tax, including £64m in the UK, up £31m on the previous year. In the UK, under the Boots brand where it has 2,000 stores, sales were £6.55bn.
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