TakeAPart: British American Tobacco in Trinidad and Tobago
Tobacco Companies are Avoiding Taxes
Support an investigation into British American Tobacco for corporate tax avoidance.
Tobacco companies worldwide exploit loopholes to avoid paying their fair share of taxes. Governments must take action immediately to stem the flow of much-needed funds from their countries by an industry already exacting a heavy toll in terms of lives lost to tobacco use. Make sure decision-makers in Trinidad and Tobago know you support an investigation of British American Tobacco for tax avoidance by sharing this post now!
How British American Tobacco Avoids Taxes
In their mission to maximize profits from the sale of deadly and addictive products, tobacco companies have been accused of activity including bribery and corruption. Now, a new report shows tobacco companies are avoiding paying corporate taxes.
Multinational tobacco companies are very profitable, however the scale of the profits and their corporate income tax paid is relatively small compared to the scale of the economic damage caused by tobacco.
A 2019 Tax Justice Network report examines corporate tax strategies for British American Tobacco (BAT) in Bangladesh, Brazil, Guyana, Indonesia, Kenya, Trinidad and Tobago, Uganda and Zambia. The report revealed a range of mechanisms used by the tobacco company to shift its pre-tax profits from those countries to BAT Holdings Ltd, a UK-based subsidiary where BAT paid almost no corporate income tax. By charging itself royalties, rerouting loans through tax havens and paying interests fees on loans made between regional offices, BAT shrunk its tax contributions in low and middle income countries where public funding is high in need and short in availability. Tax Justice Network estimates just six of these countries stand to lose nearly $700 million in tax revenue by 2030 from the financial maneuvering of British American Tobacco if business continues as usual.
According to Tax Justice Network, Trinidad and Tobago lost out on US $1.9 million per year in taxes avoided by BAT and is estimated to lose nearly US $23 million between the years 2018 and 2030.
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