Here’s How Starbucks Landed Itself a Bigger Tax Bill

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While no suggestion has been made that Starbucks (NASDAQ:SBUX) broke British law by continuously misrepresenting its tax load to authorities for the past 13 years, criticism stemming from lawmakers has caused the coffee chain to rethink its policy.

An investigation into the coffee chain’s accounting practices, which began in October, revealed that the company had engaged in complex accounting methods to minimize its tax liabilities; Starbucks had reported losses in the United Kingdom, while simultaneously telling investors that the unit was the company’s best-performing overseas market.

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To rectify the company’s slightly tarnished image and appease lawmakers, Starbucks announced on Tuesday that it will pay up to 20 million pounds in taxes in the U.K. over the next two years, more than is required by law.

“We are making a commitment that we will propose to pay a significant amount of corporation tax during 2013 and 2014 regardless of whether our company is profitable during these years,” said Kris Engskov, Starbucks’s U.K. managing director, in a speech transcript seen by Reuters.

Amazon (NASDAQ:AMZN) and Google (NASDAQ:GOOG) have received similar condemnation by British lawmakers for their tax practices.

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