Company which owns Queen’s jeweller Mappin & Webb ‘has paid no corporation tax for five years despite £66million profits’
The company that owns the Queen‘s jeweller Mappin & Webb has paid no corporation tax for five years – despite profits of £66million.
The allegations made against Mappin & Webb owners Aurum Holdings came as the conduct of firms holding royal warrants was scrutinised amid revelations about their tax arrangements.
Channel 4’s Dispatches programme will tonight claim that at least 40 of the 816 companies with Royal Warrants have foreign owners based in tax havens.
They include Mappin & Webb, whose parent company is based in Luxembourg, jeweller Asprey and restaurant chain Carluccio’s.
HP sauce, which displays its Royal Warrant on its label, pen manufacturer Parker, clothing firm Pringle and bootmaker Hunter are among those warrant holders to transfer production abroad.
Although there is no suggestion that any of these companies have avoided tax in Britain.
Royal warrants – awarded to firms that have supplied royal households for at least five years in a row – allow the holder to display a coat of arms on their products as a mark of recognition.
Leicester-based Aurum was bought by a US private equity firm in 2013 and its parent company is now based in Luxembourg, reported the Sunday Times.
The newspaper has claimed that although the firm has a ‘deferred’ tax payment of £1.98million in its latest accounts, it has not paid any corporation tax since 2010 because of business investment and ‘historical losses’.
While not illegal, such a structure casts doubt on its fitness to hold a warrant, the programme claims.
Paul Flynn, Labour MP for Newport West, said Mappin & Webb’s behaviour was ‘greed on an Olympic scale’.
He added: ‘If companies want to trade off their royal associations and advertise the warrant they have been granted on their packaging, they should at least have the decency to produce the goods in this country and pay their taxes.’
Shadow leader of the House Chris Bryant told the programme: ‘The whole point of a Royal warrant is it’s a kind of statement of British satisfaction.
‘And it must add phenomenal value to a brand especially overseas in markets like China, the Far East, the Middle East.’
He added: ‘I think that it should underline modern British values and that means it should be a company that pays taxes in this country, employs people in this country, does most of its business in this country.’
Mr Bryant called for an overhaul of the system, which is estimated by city firm Brand Finance to be worth £4.5billion to the companies that benefit from it.
The revelation follows news that Cadbury’s owner, Mondelez International, did not pay a penny of UK corporation tax last year despite generating sales of more than £2billion and profits of almost £150million.
Mappin & Webb has held a Royal Warrant as silversmith to all Britain’s monarchs since 1897.
The company’s master craftsman – Martin Swift – was appointed, in a personal capacity, as custodian of the Crown Jewels in 2012, preparing them for the State Opening of Parliament and other occasions.
Mappin & Webb holds a silversmith warrant for the Prince of Wales.
The jeweller’s owner, Leicester-based Aurum Holdings, was bought by a US private equity firm in 2013 which is now based in Luxembourg, a country seen as the home of EU corporate tax avoidance.
The Queen, Prince Philip or Prince Charles can grant a warrant to a company whose products have been used by a royal household for more than five years.
The warrant is seen as a recognition of craftsmanship and quality.
Brand Finance, a consultancy, estimates that Royal Warrants are worth £4.5billion to holders. Another Labour MP, Chris Bryant, told Dispatches that companies holding warrants should pay UK taxes and do most of their business in this country.
Graham Smith, of the campaign group Republic, said yesterday: ‘The Royal Warrant is a gift of the state and if the state is giving companies this kind of branding opportunity then the least they can do is pay their tax.’
In a statement Aurum said: ‘The Aurum group has not been in a position to pay taxes over the past five years largely due to trading conditions, investment in the business and historical losses.
‘The group is expected to have utilised its historical losses at the end of the current fiscal year.’
Heinz, which owns HP Sauce, said it still had three UK manufacturing sites employing almost 1,800 people.
Pringle said that despite major job cuts in Scotland it was ‘committed to producing and manufacturing part of every collection in the United Kingdom’.
Carluccio’s, which has its controlling company in the British Virgin Islands, said the firm was British registered and paid all tax in accordance with British laws.
Asprey, which has its parent firm in the Caymans, did not return messages.
The programme also pointed out cereal giant Kellogg’s, which holds a royal warrant, places warrant seals on sugar-rich products that are marketed at children.
Gunmaker Holland and Holland, another warrant holder, sells rifles that could be used for big game trophy hunting, the programme reported.
While there is nothing illegal about such sales, the link flies in the face of a staunch opposition to the ivory trade taken by the Prince of Wales and Prince Harry.
The programme also put the spotlight on Benedicks Mints, which has also moved operations to a foreign country.
The Lord Chamberlain’s office, which provides advice on granting warrants, said: ‘Standards are monitored, and any credible allegation that a warrant holder was acting unlawfully would result in an immediate review and may lead to a warrant being cancelled.
In a statement, it added: ‘It would be a breach of commercial confidence to reveal the details of those who were not successful in applying for, or retaining, a warrant.’
An Aurum spokesman told Sunday Times journalists Jon Ungoed-Thomas and Hannah Summers that Mappin & Webb acts ‘transparently and responsibly’ in its tax affairs and that both of them ‘are fully resident in the UK for tax purposes and always have been’.
A statement added: ‘The Aurum group has not been in a position to pay taxes over the past five years largely due to trading conditions, investment in the business and historical losses.’
Neither Mappin & Webb nor Aurum could be reached for comment by MailOnline today.