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Business

McDonald’s ‘owes France €300 million in unpaid taxes’

© Elliot Verdier, AFP | McDonald’s employees demanding salary increases protest in front of the McDonald's outlet in Disney Village near Paris, on April 14, 2016

Text by Joseph BAMAT

Latest update : 2016-04-21

McDonald’s this week is battling the twin accusations that it owes France millions of euros in taxes and pays its workers unacceptably low wages.

France’s finance ministry has told the US fast-food giant that it owes 300 million euros in taxes, based on profits that were allegedly siphoned through tax-avoidance schemes based in Luxembourg and Switzerland, according to a report published on Tuesday.

French business monthly magazine L’Expansion reported that authorities sent the bill to McDonald’s at the end of 2015 as part of ongoing tax fraud investigations that began in 2013.

The report said the hamburger chain – the biggest restaurant franchise in France – used the Luxembourg entity “McD Europe Franchising” to move profits to lower-tax jurisdictions.

Dodging the issue?

The Luxembourg-based business of the US burger company billed the French division excessively for use of the company’s brand and other services, the report said.

McDonald’s France has declined to confirm if it has been slapped with a 300-million-euro tax bill, which L’Expansion claimed included 100 million euros in fines.

In a statement sent to FRANCE 24 by text message, McDonald's dodged the issue and simply stated that it was proud to be “one of the biggest payers of company tax in France”, having paid 1.2 billion euros in taxes since 2009.

It went on to defended its record, noting that it had invested 1 billion euros and created 15,000 jobs in the country over the past seven years.

France’s finance ministry has also declined to comment due to its tax secrecy rules.

Protesting for better pay

McDonald’s woes were further compounded by protests over employees’ pay and job security in northern Paris.

Protesters blocked the entrance to a McDonald’s restaurant, as well as two rival fast-food chains, near the Gare du Nord train station just before noon on Wednesday.

They spray-painted “Pay your taxes” and “No permanent contracts, no Big Macs” on its window.

At least some of the people who formed a human chain in front of the McDonald’s franchise appeared to belong to the Nuit Debout, or Up All Night left-wing protest movement, which has spread from Paris to the rest of the country since March 31.

A Facebook page created by those who protested outside McDonald’s said they were demanding a pay rise to 13 euros per hour.

Date created : 2016-04-21

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