People are leaving fake price tags in IKEA to call out tax avoidance
Some people think popular furniture store IKEA is being naughty, and not paying its proper share of tax in Australia.
The franchise is a behemoth, both literally in terms of store size and figuratively in that it collected a US$5 billion profit for the 2014 financial year.
A community action group has decided IKEA should be paying a bigger share of tax in Australia, and is letting people know this in a nifty way. Volunteers from Fair Go For Canberra, a group located in Australia’s capital city, have protested the city’s new IKEA store by putting fake price tags on items.
The tags read: “During the period from 2002 – 2013, IKEA’s Australian stores made over A$1 billion (US$710 million) in profit, and paid less than A$31 million (US$22 million) in tax.”
“That’s a tax rate of 3%. The corporate tax rate in Australia is 30%. Imagine what we could do with A$269 million (US$191 million).”
The tags have a URL to a page on Fair Go For Canberra’s website, which alleges IKEA isn’t the only big company with a bad habit of tax avoidance. The activists have even created a new logo: “IKEA: Design, quality and aggressive tax minimisation.”
“They’re not the only company using these legal aggressive tax minimisation tactics to rip off the Australian people,” the site reads. “The world’s largest tech companies like Apple, Google, Microsoft, as well as mining and fossil fuel companies like BHP, Shell, Glencore and Rio Tinto, all pay next to nothing in tax.”
The group is asking people to sign their names on a petition to take to Australian Prime Minister Malcolm Turnbull on the matter.
The move comes at a time when Australia is debating the idea of possibly increasing its Goods and Services Tax — a sales tax, commonly known as GST — from 10% to 15%.
Fair Go For Canberra is against the idea, citing research from the Australian Council of Social Service that claims raising the tax will affect low-income earners the most, and create further inequality.
While consumers are expected to soon be charged more in tax, the corporate giants have had an easier ride, Fair Go For Canberra claims.
In April, Google, Apple and Microsoft faced an Australian Senate inquiry into tax avoidance where they were grilled on their interesting practices. All three companies were coy in their responses, admitting their profits were being sent offshore — with acknowledgment this could mean in Bermuda or Singapore, where the corporate tax rate is low.
It appears some people believe IKEA may also have lost A$269 million in the Bermuda Triangle.