Cadbury's Owner Under Fire Over Tax Affairs

Cadbury's owner Mondelez has come under fire over its tax arrangements after a newspaper investigation found it paid no UK corporation tax last year.

The Sunday Times found that interest payments on unsecured debt, listed as a bond in the Channel Islands, were able to be offset against gains elsewhere.

The arrangement, which is legal, wiped out the tax bill - despite sales of more than £2bn last year.

Margaret Hodge, chair of the Commons all-party group on responsible tax, told Sky News: "Multinationals like this are deliberately exporting their profits with artificial company structures to avoid tax.

"The founders of Cadbury, who set it up as an ethical company, will be turning in their graves."

The story prompted a call for a boycott on Twitter (Xetra: A1W6XZ - news) under the hashtag #Boycottcadbury. One user said it was "shameful" for Cadbury's not to pay tax, adding: "No Cadbury in my house this Christmas."

Mondelez said: "We comply with all applicable tax legislation in the UK, and on a global basis we pay hundreds of millions of dollars in corporate income tax annually."

It (Other OTC: ITGL - news) said that since 2010 it had invested more than £200m into UK manufacturing and research and development, supporting 4,500 employees in the UK. It added that the business was worth more than £1bn to the wider UK economy.

Mondelez is the latest global firm to attract controversy over its UK tax affairs, with Starbucks (Swiss: SBUX.SW - news) , Google and Amazon also coming under the spotlight.

Cadbury's was taken over by Kraft Foods (NasdaqGS: KRFT - news) in an £11.5bn deal five years ago. It was criticised at the time for closing a plant near Bristol with the loss of 450 jobs, reneging on a pledge to keep it open.

Kraft was split up in 2012 with its snacks business becoming Mondelez International (Xetra: A1J4U0 - news) .

Last week, Sky News revealed that Terry's, another brand owner by Mondelez, was being put up for sale . UK production of the brand ended in 2005 after the closure of a factory in York.