Royal warrant companies accused of using tax havens and moving their manufacturing out of Britain
Companies like Mappin & Webb have not paid any corporation tax for the past five years, according to the Sunday Times
Several companies which hold the much-coveted royal warrant have come under scrutiny after being accused of benefiting from tax havens and moving their manufacturing out of Britain.
The warrants are awarded to firms which have supplied royal households for at least five consecutive years. They entitle companies to display a coat of arms on their products as recognition of their royal patronage.
In the past, it has been seen as a symbol of British craftsmanship. However, inquiries into these firms have revealed many have moved their operations abroad and some are based in tax havens.
An investigation by Channel 4’s Dispatches programme found that jeweller Mappin & Webb, which has held a royal warrant since 1897, has a parent company, Aurum, based in Luxembourg.
In addition, an analysis of the company’s accounts by The Sunday Times appeared to show that it had not paid any corporation tax for the past five years on profits of £66m.
Mappin & Webb insisted it acted “transparently and responsibly in all tax affairs”, while its parent company claimed: “The Aurum group has not been in a position to pay taxes over the past years largely due to trading conditions, investment in the business and historical losses.”
Other big-name brands holding royal warrants have also moved their bases out of Britain taking manufacturing jobs overseas.
HP sauce, trading on its British connection to the Houses of Parliament, is now made in Holland. Parker Pens moved its production to France in 2009, and in 2011 Bendicks Mints shifted its manufacture to Germany.
Shadow leader of the House Chris Bryant told the programme: “The whole point of a royal warrant is it’s a kind of statement of British satisfaction and it must add phenomenal value to a brand, especially overseas in markets like China, the Far East, The Middle East.
“I think that it should underline modern British values and that means it should be a company that pays taxes in this country, employs people in this country, does most of its business in this country.”
Mr Bryant has called for an overhaul of the system, which is estimated by City firm Brand Finance to be worth £4.5bn to companies holding warrants.
The Lord Chamberlain’s Office, which provides advice on granting warrants, said: “Standards are monitored, and any credible allegation that a warrant holder was acting unlawfully would result in an immediate review and may lead to a warrant being cancelled. “
