Giant multinational brewer SABMiller – the company that owns Grolsch, Peroni, Miller and Castle – avoids an estimated £20m of taxes in Africa and India every year, enough money to educate a quarter-of-a-million children there.
The world’s second biggest brewer uses a complex system of tax havens to siphon as much as £100m of profits out of its African and Indian subsidiaries, depriving those governments of significant amounts of tax. It has more tax haven companies than it does breweries and bottling plants in Africa. In Ghana, SABMiller’s brewery has paid no corporation tax at all for the last two years, despite booming business.
One way in which SABMiller avoids tax is by holding valuable trademarks for African beers in Europe rather than in their country of origin. The cost of using the trademarks helps eat into the profits in the African subsidiary, so less tax is paid there. Other ways of avoiding tax include paying “management fees”, mostly to Switzerland, and routing its procurement services via a subsidiary based in Mauritius.
SABMiller’s tightwaddery doesn’t stop in developing countries. “Taxation was a key part of our decision to locate a new global procurement business not in the UK but in Zug in Switzerland,” its Chief Executive Graham Mackay said last year.
ActionAid UK, December 2010
- Image: Andrew Aitchison