Civil society groups in Europe have accused McDonald's of evading more than 1 billion euros or $1.1 billion in tax over five years between 2009 and 2013.
Article continues below
The company is said to have managed low taxes by routing its royalty payments from Europe through its subsidiary based in tax havens such as Luxembourg.
The one billion euro tax evasion figure has been derived by calculating the actual tax on the royalties McDonald's received from European countries and major markets like France, the U.K., Italy, and Spain.
The group, consisting of labor unions and a charity group, are calling for the European Commission and respective national tax authorities to launch an investigation on the world's largest restaurant chain's tax practices and take appropriate measures.
The coalition of European and American trade unions, along with U.K-based anti-poverty campaign group War on Want, unveiled a report related to McDonald's deliberate avoidance of corporate taxes in Europe. The report is the first to shed light on the company's tax record.
The trade unions include, European Federation of Public Service Unions (EPSU), U.S.-based Service Employees International Union (SEIU), and European Federation of Trade Unions in the Food, Agriculture and Tourism sectors (EFFAT). The unions represent more than 15 million workers in different sectors of the economy in 40 countries.
A complaint was filed in court against McDonald's by a group of Brazilian unions requesting that the company not open another restaurant as long as it fails to comply with the nation's labor laws.
"McDonald's in Brazil keeps its employees in conditions of semi-slavery and commits what we call social dumping, which means practicing unfair competition by denying labor rights in order to make more profits,†Moacir Tesch Auersvald, head of the Contratuh union representing restaurant and hospitality workers, told a press conference.
The complaint is backed by about 10 Brazilian unions in the context of a global movement initiated in the United States by the Service Employees International Union.
"McDonald's breaks the law by extending the workday beyond the number of hours permitted, by hiring teenagers for what are considered high-risk jobs, and by not paying for overtime," Tesch said.
The attorney in charge of filing the complaint in court, Joao Piza, told Efe that in all of Brazil there are some 400 lawsuits against the company dealing with the same subjects. ■