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Starbucks praised the "loyalty" of its UK customers despite the public outcry over its tax avoidance (Reuters)

Once again, the failings of HMRC in its risible attempt to stop corporate tax avoidance are decried by parliament and no doubt public dismay will follow.

The Public Accounts Committee, which led an inquiry into tax avoidance, HMRC and the big four accountancy firms, made several predictable demands.

Give HMRC better resources; stop tax advisers jumping in and out of the tax office and those it polices because it is a "ridiculous conflict of interest"; simplify the tax system.

This is all well and good, but there are about 60m elephants in the room - British consumers.

While government and business shortcomings are easy targets for vitriol from lawmakers, it is harder for them to criticise their own electorate, which continues to validate tax-avoiding multi-national corporations by stuffing cash into their ever-ringing tills.

Consumer behaviour is reminiscent of the sort of hard-line religious pastors dishing out frothing sermons on morality over the pulpit, all the while being trousers-down with a rent boy underneath it.

We want the moral superiority of decrying tax avoidance, as well as the gratification of crap convenience coffee from a ubiquitous chain, even if it goes against our purported values.

Tax avoiders' growing sales

Amazon, the online retailing behemoth, took poll position in a YouGov consumer survey as one of Britain's favourite brands. Yet its tax affairs - or lack thereof - are under investigation in a number of countries across the world.

Does this deter conscientious consumers from using Amazon's convenient services?

The firm's first quarter sales suggest not.

Amazon's revenues rose 22% to just over $16bn (£10.3bn, €12.3bn) in the first three months of the year, as furious consumers rush to the internet and vent their rage at the company's tax avoidance by shopping there.

Second in the brand popularity stakes is Google, another outed tax avoider that managed to, perfectly legally, get away with paying a miserable £6m in UK corporation tax despite £2.5bn of revenues in the country. Still, we happily use Google and its many services each and every day.

Another ubiquitous consumer favourite is the US coffee chain Starbucks, which paid just £8.6m in UK corporation tax in 13 years on its £3bn sales. After public outcry and calls for a boycott, which does not look to have lasted past the initial eruption of consumer rage, Starbucks patted HMRC on the head and stroked its belly with the offer of £20m to be paid over two years.

Since then, Starbucks has praised the "loyalty" of its servile customer base in the UK, as consumers behave like crack addicts returning over and over to the same abusive dealer.

Confused global tax law helps multinational corporations, which sell services all over the world, as the wrangling and negotiations between governments rattles on without consensus on what to do.

It means companies can go on secretly diverting money around the world to different businesses, spreading it thinly among low-tax jurisdictions to significantly reduce their liabilities in the countries where these sales were originally made.

Yet still the sales go up among some of the most well-known tax avoiders in the country, despite opinion polls suggesting the overwhelming majority of Britons are repulsed by HMRC-dodgers.

A ComRes poll found that 80% of Britons are "angry" about tax avoidance by multinationals - yet only 34% actively boycott these companies.

Tax avoidance: why should consumers care?

Around £5bn a year is lost through tax avoidance. Maybe this is ploughed back into the economy through investment in jobs and growth. Perhaps this money finds its way into the third sector, where charities can do more great work thanks to the help from generous and caring corporate friends.

Or perhaps it finds its way into the profligate pockets of moneyed executives and owners, the financial elite whose extravagance parallels that of the ill-fated 18th Century French aristocracy.

What we can be sure of, however, is that this money is not making its way into the public purse.

These billions are being swept away from HMRC's limp-handed grabs as society's poorest and most vulnerable have financial lifelines stripped away from them under the government's austerity cuts; as key services that support the welfare of local communities are tossed in the bin; as child poverty rates soar and hundreds of thousands of Britons rely on food banks to eat.

Government can be wasteful and it often spends dubiously, so perhaps there is an argument - favoured by libertarians - that depriving it of resources will induce thrift and prudence, as well as a general reduction in the reach of the state's punishing hands.

But when the argument is that there is not enough money to help the worst off in society, while there is £5bn wilfully being lost through loopholes in the law, it is difficult to suggest that tax avoidance is preferable to supporting the paltry and diminishing incomes of the poor.

There is also a competitiveness issue here.

Why should smaller tax-honest firms be put at a disadvantage just because they cannot afford to kerb-crawl and solicit the services of the sauciest tax account offering a bit of leg? It is already hard enough to compete with monster competitors without them benefiting from a tax position unavailable to most others in the market.

Consumer behaviour must change

If the opinion polls are to be believed and British consumers really do feel that strongly about tax avoidance, then we must stick to our principles and boycott the firms we know do it. It suggests the majority is not indifferent on the issue, so why the hypocrisy?

Perhaps it is pessimism that prevents us changing our consumer behaviour. Why bother avoiding the avoiders when nothing will change? Better to buy with bitterness than be left out of the consumption orgy.

We shouldn't be so pessimistic about the impact of changing consumer habits. Corporations are nifty commercial animals, adaptable to a changing environment. They react to demand as it is in their interest. Starbucks' £20m tax deal with HMRC after the short burst of outrage gave a sniff of the power consumers hold as a collective.

Massive shifts in demand will cause massive shifts on the supply side. All too often we blame the government and business without realising the power in our own hands. Take responsibility for your buying behaviour and stop being a hypocrite.

Consumers of the world, unite! And stop buying terrible coffee from corporate tax avoiders.

Related Articles:

UK Parliament Accuses HMRC of 'Unhealthily Cosy' Relationship with Tax Avoidance Accountants

UK Tax Avoidance: Top 10 Giant Companies Dodging Corporation Tax [SLIDESHOW]

UK Tax Avoidance: HMRC Spots £1bn in Potential Unpaid Big Business Tax

Starbucks, Google and Amazon to Face Legislators' Probe Over Tax Avoidance

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