Starbucks Critical Analysis

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Critical Analysis Starbucks tell their investors that the business in in good condition while it report losses when it comes to taxation matters (Bergin, 2012). This is a strategy so that they would pay lesser tax without worrying their investors. Tax avoidance is considerably a legal tactic being used by huge multinational companies not only by Starbucks, but for the case of Starbucks, it became easily recognized by the public because they declared losses yet boasted better income condition to their investors. Tax avoidance can be seen as aggressive as it involves financial instruments and arrangements that are not intended as vehicle for tax advantage; it is perhaps one of the most important issue that should be addressed in UK (Back,…show more content…
Ethics therefore, is important for corporations, big or small. Despite of the public shaming that they receive, Starbucks conveyed through their website, their side in the issue of tax avoidance and that the allegation is ill because they adhere to the law of every country where they do business (Starbucks). Starbucks also declared their years of giving back to the community in their own ways such as their ethical company culture and how they treat their employees and give back to charities. The company did not admit tax avoidance just like other corporation would do if faced with ethic-related social questionings. The tax avoidance practices of multinational enterprises are under increasing scrutiny by the public in ethical perspective as well in legal one (Colle & Bennett). The public believe that the company did avoid tax whether they admit it or not because it was obvious with their released reports. Tax payments are usually considered as fundamental and measurable example of a citizenship behaviour of a company (Dowling, 2014). Starbucks conveyed their ethical belief with their tax avoidance which annoyed many of their loyal customers and encouraged people to boycott their products and services. This eventually led into profit-loss. The sales of Starbucks have tumbled in Britain after its tax-avoidance issues (Spanier, 2014). Starbucks hurdles a major public and…show more content…
The analysis pointed out using ethic theories of principle of justice and deontological ethics, that it is not ethically right for Starbucks to avoid the tax that they should pay using transfer pricing as their tax avoidance strategies. Kant’s universal law is not also compatible to the decision of the company to deny their social responsibilities. It appears that even if the company is aware with their rational choices and has high standard in terms of corporate responsibility, they still do not fully comply with their corporate social responsibility. Part of their social responsibility is to give back what the community deserves and that is the exact amount from the the corporate world. It would not be fair both for the general public and to other companies that are paying the right taxes if big corporations would just opt for tax

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