Member Article

Cadbury owner paid no UK corporation tax despite eight-figure profit

Mondelez, the food and beverage giant that owns Cadbury, reportedly did not pay any UK corporation tax last year despite making profits of more than £90m.

The Sunday Times found that the firm, which also includes the Kraft foods group, was cancelling out Cadbury’s bills using interest payments on an unsecured debt, which is listed as a bond on the Channel Islands’ stock exchange. This arrangement allows interest paid on the loan to be offset as a loss against gains made elsewhere in the company.

Mondelez paid no corporation tax to the UK government despite reporting profits of £96.5m for Cadbury in 2014.

Margaret Hodge, chairwoman of the Commons all-party group on responsible tax, told the Sunday Times: “Multinationals like this are deliberately exporting their profits with artificial company structures to avoid tax. The founders of Cadbury who set it up as an ethical company will be turning in their graves.”

Cadbury was acquired by Mondelez five years ago in a deal worth more than £11bn.

A Mondelez spokesperson said: “In common with all global businesses, we pay corporation tax based on the laws of the countries in which we operate.

“We comply with all applicable tax legislation in the UK, and on a global basis we pay hundreds of millions of dollars in corporate income tax annually. Since 2010 we are proud to have invested over £200m into both UK-based manufacturing and R&D supporting our 4,500 employees in the UK.

“Importantly, independent academic research has also shown that as a business we are worth over £1bn to the wider UK economy, illustrating our impact reaches far beyond the factory gates.”

This was posted in Bdaily's Members' News section by Ellen Forster .