McDonald's summoned by European Tax Committee

McDonaldMcDonald’s has been summoned to appear before the European Tax Committee in relation to allegations of tax evasion

It will appear before the TAX3 Special Committee on Financial Crimes, Tax Evasion and Tax Avoidance today, following an investigation by the European Commission, which was opened in 2015.

The appearance follows a report published last month that said the company had avoided paying more than €1bn (£878m) in taxes from 2009 to 2013.

A report by European and US trade unions, titled Unhappier Meal, revealed that in the past three years McDonald’s has relocated its international tax base to the UK and transferred the headquarters of McD Europe Franchising Sàrl from Luxembourg to Delaware, “a jurisdiction with very limited disclosure requirements”.

This will be first time a multinational has appeared before the committee for the third times.

Jan Willem Goudriaan, general secretary of the European Federation of Trade Unions in the Food, said: “The move of McDonald’s to Delaware bringing more opacity and complexity just begs belief and makes our case for public and global country-by-country reporting a total must. The fact that the European Parliament has asked them to come shows that they have a lot to answer for. It is a major problem that they benefit from Europe’s cash-strapped public services but refuse to contribute to them.”

Rocio Sáenz, executive vice president of the Service Employees International Union, said, “McDonald’s undercuts workers and communities all across the world in order to inflate its profits. Members of the European Parliament should demand McDonald’s answer questions about its tax dodging scheme and hold the company accountable for the €1bn in taxes it owes.”

The two organisations urged MEPs to pressure McDonald’s to give more details about their new tax base for European operations and explain why it moved the registered office of the company targeted by the European Commission’s probe to Delaware – as well as why it decided to relocate to the UK following the Brexit vote, especially if the Luxembourg scheme was legal as it stated.

War on Want's senior campaigner on economic justice, Owen Espley, commented, " For too long, McDonald’s has been allowed to drive-thru communities without paying its fair share of tax and while serving its workers an unhappy meal of exploitation, zero hours contracts and union repression.

“McDonald’s workers are pushing back, joining together in the McStrike to demand this multi-billion pound company pay its fair share to the workers that make it rich,” he added. “The committee needs to make sure it does the same for the communities in which it operates. Fuelled by hidden profits and poverty wages, McDonald's business model is an engine of inequality that needs to be stopped."

McDonald’s has been approached for comment.


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