In January 2020 Ethical Consumer viewed the John Lewis Partnership Annual Report 2019. This contained a list of the company's subsidiaries. These included:
- Admiral Park Retail Management Limited, incorporated in Guernsey
- JLP Insurance Limited, incorporated in Guernsey
Both of these companies were considered high risk of being used for tax avoidance, as they were listed as providing 'Insurance' and 'Management Services' based in tax havens.
However, in August 2019 Ethical Consumer received an email from John Lewis which clarified the company's tax policy:
"A John Lewis Partnership spokesperson said: “Paying taxes arising from our activities is an important part of how we contribute to the societies in which we operate. As such, we do not use tax avoidance strategies. Our 2019 Annual Report and Accounts lists the subsidiaries which contribute to the overall profitability of the Partnership. We also submit a country by country report to HMRC.
Admiral Park Retail Management Limited, incorporated in Guernsey, is a property holding company which owns the freehold of the Admiral Park Waitrose store site in Guernsey. The entity does not provide management services and has no revenue. JLP Insurance Limited operates in Guernsey because of the self- insurance expertise they have on the island and any profits it makes are entirely taxable in the UK through the Controlled Foreign Company regime.”
Additional background on contributing to the UK tax system (see page 21 of the 2019 Annual Report & Accounts)
In 2018/19 the Partnership paid taxes of £379m. Key contributions were:
- Business rates: £179m
- Employer NICs: £118m
- Corporation tax: £33m"
The above statement was considered an adequate explaination of why the comany owned the subsidiaries considered by Ethical Consumer to be high-risk and located in juristictions of Ethical Consumer's list of tax havens at the time of writing.
One other subsidiary were listed in Guernsey and one in Jersey, however, these were listed as 'food retailing' and the company had Waitrose food retail shops in these jurisdictions. Although these were located in territories on Ethical Consumer's list of tax havens, they were considered to be low risk of being used for tax avoidance purposes as they were assumed to be serving the local population.
As a result, the company did not lost any marks for likely use of tax avoidance strategies.