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Coffee chain Starbucks made £372million in revenues in the UK, according to its latest set of accounts, but paid just £3.3million in corporation tax.

That's less than half the tax it paid the year before, despite a rise in like-for-like sales.

Profits did fall, however.

Figures from Starbucks Coffee Company UK Limited, the multi-national's UK arm, showed the group’s profits before tax fell to £4.5million from £6.7million in 2016.

Starbucks said operating costs increased in 2017 to £301million, mostly thanks to spending on "higher quality products" - with new food and drink items including cold coffees such as Nitro Cold Brew and Cappuccino Freddo.

(Image: REUTERS)

The company also extended breakfast and lunch menus, adding two new hot porridge varieties, more fresh salads and under 500 calorie hot lunch boxes.

"It’s still challenging to operate in the UK, as one of the world’s most competitive coffee markets, but we will continue to invest for long-term growth," said Martin Brok, president for Starbucks EMEA.

The latest accounts for Starbucks UK cover the year running to October 1, 2017, and have been published three months late.

Starbucks promised to change its approach to paying Corporation Tax in Britain after it emerged in 2012 that in the previous 14 years it had paid a total of just £8.6 million in tax - including a three year spell where nothing at all was paid.

Letter from Martin Brok, President, Starbucks Europe, Middle East and Africa

Dear Sir

Recent reporting by The Mirror in relation to our tax affairs did not accurately reflect the amount of tax paid by Starbucks in the UK and our effective tax rate. We would like to set the record straight.

As our public filings clearly show Starbucks paid £13.7m of tax in the year to October 2017, an effective rate of corporation tax to the British exchequer of 25.3% - substantially more than the UK’s corporation tax rate of 19.5%.

We have acknowledged previous shortcomings in our tax obligations in the past and have taken unprecedented efforts to change that including moving our regional headquarters to the UK.

The Financial Times, who first reported the incorrect statistics, published a letter on 16 November 2018 clarifying this matter.

Regards,

Martin Brok

President, Starbucks Europe, Middle East and Africa