By Jonathan Davies
Kellogg's has warned that the international clampdown on tax avoidance could hurt its profits.
The UK is one of a number of countries that are promising the clampdown on loopholes that allow multinational companies to move their profits elsewhere in order to pay less tax.
Amazon, Apple, Google and Starbucks are some of the biggest names to have been criticised for paying a reduced tax bill in the UK.
The government recently introduced the Diverted Profits Tax, dubbed the 'Google tax', which taxes companies that divert their profits elsewhere. The Chancellor George Osborne said it will generate more than £3 billion for the UK economy.
Kellogg's, the US food company behind brands like Corn Flakes, Rice Krispies and Coco Pops, said closing the loopholes would have a "material" impact on its tax bill.
“Due to economic and political conditions, tax rates in various foreign jurisdictions may be subject to significant change,” its annual report said.
It added: “Contemplated changes in the UK and other countries of long-standing tax principles if finalized and adopted could have a material impact on our income tax expense.”
According to a report by the Sunday Times (paywall), two of Kellogg's UK subsidiaries paid corporation tax of £8.4m on profits of £50.3m in 2013. That was offset by a £11.8m tax credit by another of its UK companies.
The Sunday Times also reports that Kellogg's has six companies registered in Luxembourg, where businesses pay 0.37% corporation tax, compared to the UK's 20%.
Kellogg's said it is a "responsible taxpayer" in the countries where it operates and does not believe it will be affected by the Divert Profits Tax.