Starbucks has defended its little-known Swiss subsidiary handling its ethical coffee sourcing after a critical report accused it of “major global tax avoidance.” The report, released by the Centre for International Corporate Tax Accountability and Research (CICTAR), accuses the Lausanne-based Starbucks Coffee Trading Company, or SCTC, of helping the café giant move about $1.3 billion in profits over the last decade away from jurisdictions with higher tax rates. It prompted local nonprofits to stage a protest outside the subsidiary’s headquarters, denouncing the legal mechanism as unethical and particularly unfair to the Global South. “Switzerland is a global commodity trading center and one of the world’s most abused tax havens,” CICTAR said. “Multinational corporate profits artificially shifted to Switzerland significantly reduce government funds needed to pay for essential public services around the world. With Starbucks, this includes the US, by far its largest market.” In a statement issued to Mongabay on April 17, Starbucks said the report failed to accurately reflect its business model. “Starbucks is in full compliance with tax laws around the world, with an effective global tax rate of over 24% in 2024,” a spokesperson said. “Starbucks Coffee Trading Company (SCTC) plays an essential role in ensuring we have access to high-quality coffee to meet our global demand, sourcing coffee from over 30 countries, and operating 10 farmer support centers in coffee farming communities around the world. “Switzerland has been a global hub for coffee trading for decades and SCTC is based there to help us access the…This article was originally published on Mongabay

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