View source for Pharma: Tax Avoidance

'''Pharma: Tax Avoidance'''

A report in ''The Guardian'' shows how pharmaceutical giants [[GlaxoSmithKline]] and [[AstraZeneca]] "offshore" legal ownership of their valuable trademarks to low-tax locations.<ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/offshore-tax-avoidance Offshore - and out of reach to the Revenue] ''The Guardian'' Accessed on 3 February 2009</ref> More than 40 [[GlaxoSmithKline]] trademarks went to a factory in Puerto Rico. Amongst them was the title for the blockbuster diabetes drug [[Avandia]]. These were shifted in to the firm's premises in Cork in 2007, when production was phased out at [[SB Pharmco Inc]] in Puerto Rico after quality control problems arose. <ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/offshore-tax-avoidance Offshore - and out of reach to the Revenue] ''The Guardian'' Accessed on 3 February 2009</ref> [[Helen Jones]], head of tax at [[GSK]] says: "It is a widespread and totally accepted practice for global companies to license out intellectual property in return for royalties which reflect the value of work carried out by the holder." <ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/offshore-tax-avoidance Offshore - and out of reach to the Revenue] ''The Guardian''Accessed on 3 February 2009</ref>

[[Zomig]] and [[Crestor]] are two of [[AstraZeneca]]'s drugs that have been placed in a tax haven in Puerto Rico. The trademark for [[Faslodex]] was assigned to [[IPR Pharmaceuticals Inc]] in the Caribbean territory, which is owned by AstraZeneca. <ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/1 AstraZeneca] ''The Guardian'' Accessed on 3 February 2009</ref>

==Facts and Figures==

* 'GSK pays on average more than 80% of its tax to overseas countries rather than to Britain.' <ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/offshore-tax-avoidance Offshore - and out of reach to the Revenue] ''The Guardian'' Accessed on 3 February 2009</ref>

* 'GSK's worldwide profits were £7.4bn, the company's actual UK tax bill was only £450m.' <ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/offshore-tax-avoidance Offshore - and out of reach to the Revenue] ''The Guardian'' Accessed on 3 February 2009</ref>

* 'GSK said last year that there were "wide differences in positions" between the company and HM Revenue & Customs, which might lead to litigation. But in June, the disputes were suddenly resolved "with no material impact on the expected tax rate for the year".' <ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/offshore-tax-avoidance Offshore - and out of reach to the Revenue] ''The Guardian'' Accessed on 3 February 2009</ref>

* 'It ([[AstraZeneca]]) made a settlement of up to $100m (£70m) with UK and US authorities in 2004, and it still faces "tax audits" around the world. It has put aside a precautionary $1.3bn in its accounts as a result.'<ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/1 AstraZeneca] ''The Guardian'' Accessed on 3 February 2009</ref>

* 'The company ([[AstraZeneca]]) says it makes more than 70% of its profits overseas, and pays the necessary taxes abroad.'<ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/1 AstraZeneca] ''The Guardian'' Accessed on 3 February 2009</ref>

* The US arm of AstraZeneca was named in 2004 as one of the 30 companies involved in a large avoidance scheme sold by the US arm of the international accountants KPMG.' <ref> Tax Gap reporting team.[http://www.guardian.co.uk/business/2009/feb/03/1 AstraZeneca] ''The Guardian'' Accessed on 3 February 2009</ref>

==Notes==
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[[Category:Big Pharma]]