SABMiller denies tax wrongdoings in Africa

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African countries unite to examine world’s second biggest brewer’s tax affairs
SABMiller has rejected claims of tax avoidance in Africa as South Africa, Ghana, Zambia, Tanzania and Mauritius decided to work together to inspect the brewer’s tax affairs after a damning report.

The African Tax Administrative Forum, led by South Africa, involved the five countries joining to examine claims by charity ActionAid International that the world’s second biggest brewer uses tax havens to avoid paying tax.

SABMiller, based in London, brews Castle, Grolsch and Peroni beers but denies any wrongdoing indicated in the report, which was released last November. The brewer said it was a major direct investor, employer and taxpayer in Africa and in its financial year to ending in March 2010 had invested more than $500 million in Africa on new breweries and acquisitions.

“We entirely refute ActionAid’s allegations that we do not pay our fair share of tax in Africa and would add that the report contains a number of flawed and inaccurate assumptions,” said an SABMiller spokesman.

ActionAid said tax authorities will work together on the tax issues although any action would be taken by the individual countries.

“We worked closely with former tax inspector from the UK, Richard Brooks, and all our work is based on the company’s accounts. Our assessment is that the transfer pricing payments are a form of tax avoidance,” said ActionAid’s tax expert Martin Hearson.

“This unprecedented initiative marks a new era in which rampant tax avoidance by multinationals in developing countries will come under much closer scrutiny, both from tax authorities and from campaigners.

“Tax avoidance by multinationals costs billions in lost revenues, which could transform healthcare and education services for millions of people,” he added.