McDonald’s ‘has avoided paying £658m tax in Europe’

MCDONALD’S is facing allegations of avoiding paying taxes in Europe.

Trade unions have complained to the EU competition commissioner that the burger chain avoided paying more than £658million in corporate taxes between 2009 and 2013.

The allegations centre on claims that McDonald’s opted to move its UK headquarters to Switzerland, before channelling cash into a Luxembourg-based company with a Swiss branch – at a time when the current European Commission president Jean-Claude Juncker was prime minister of the principality.

McDonald’s could face millions of pounds in back payments if it is proven to have dodged its taxes. The unions say that the Luxembourg unit had sales of £2.7billion – but only employed 13 people and reported paying just £11.8million in taxes.

European watchdogs have been cracking down on aggressive tax avoidance, opening inquiries into Apple, Amazon and Starbucks amid concerns they have shifted profits between countries and deprived governments of tax revenues.

The European Union has been working on new laws to force countries to swap information on tax rulings they give to companies every three months, such as how their taxes will be calculated.

They currently rarely swap information about decisions and are usually unaware of rulings made elsewhere, leaving open loopholes that can be used to reduce tax bills.

EU competition commissioner Margrethe Vestager yesterday said her office was ‘looking into the information gained by trade unions when it comes to McDonald’s in order to assess if there is a case’.

McDonald’s last night declined to comment on the allegations.