Tax abuse costs the UK economy £69.9 Billion a year – more than half of the country’s total annual healthcare spend. Meanwhile, health and social care services are being slashed in the name of austerity and affordability. By undermining public services, tax abuse harms society and risks public health. It is wrong, should not be tolerated and must be stopped. That’s why Medact has launched a campaign with War on Want, Change to Win and UNITE the Union against tax abuse.
Tax avoidance and evasion are extremely common and many transnational corporations avoid paying tax in ways that may be legal, but which are clearly unethical and wrong
One of these is the parent company of the UK’s well-known high-street pharmacy, Alliance Boots.
One study estimates that the tax illegitimately avoided by Alliance Boots since 2007 amounts to £1.21 billion – enough to pay for 85,000 new nurses for one year, or to cover the prescription charges for the whole of England for almost three years. At the same time, Boots is expanding its service contracts in the NHS. There is something not right about companies like Boots profiting from the NHS whilst contributing to the country’s public deficit through tax avoidance.
Although Alliance Boots is not alone in practising legal but illegitimate tax avoidance, it does provide a good case study of how the NHS is simultaneously being starved of finance whilst being turned into a cash cow for profit-hungry firms.
But there are other reasons for health professionals to be concerned about Boots. Far from the friendly high street chemist we would like to it be, since its amalgamation into a multinational conglomerate, it appears that the ethos of Boots has shifted to focusing on profit generation – at the cost of customer health, safety and satisfaction.
Symptoms of this contamination by business logic include decisions to insist on selling products of questionable safety and heavy-handed labour practices affecting its staff (read more in background).
In other words, Boots also provides a good case study of the corporatisation and commercialisation of health care. Even if we want the pharmacy retail sector to be left predominantly in the private sector, we want it to function as a proper and fair market. Not one which short-changes both professional pharmacists and the general public.
Boots the Chemist was founded in 1849 in Nottingham and has long been an icon of the British high street. In 2006, however, Boots merged with European pharmacy wholesaler Alliance Unichem Plc. to form Alliance Boots. Alliance Boots receives an estimated 40% of its UK revenue – £4bn – directly and indirectly from the NHS through dispensing and related services. It operates pharmacy retail, wholesale, generic manufacturing and clinical homecare businesses. It is also the largest community pharmacy chain in the UK – nearly 2,400 pharmacies trade under the Boots banner. Alliance Boots is the largest single employer of pharmacists and pharmacy technicians outside the NHS. Outside the UK, Alliance Boots is primarily a pharmacy wholesaler—the biggest in Europe. And the corporation plans to expand its retail footprint to other healthcare services, including: medicine check-ups, weight management programmes, smoking cessation advice and flu vaccinations.