Tesco share price: Group criticised over deductions from plastic bag tax charity donations
Tesco (LON:TSCO) has come under fire as government data revealed that the company deducted administration costs from plastic bag sales, unlike other major supermarkets, the Guardian has reported. The news comes as Britain’s biggest grocer continues to try to repair its public image following an accounting scandal about three years ago.
Tesco’s share price has been little changed in today’s session, having inched 0.06 percent higher to 186.11p as of 13:53 BST, slightly underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.56 percent higher at 7,395.15 points. The group’s shares have added more than eight percent to their value over the past year, but have given up some 10 percent in the year-to-date.
The Guardian reported today that the latest official statistics had showed that Tesco had sold 637 million carrier bags in the year ended March, raising £31.9 million in proceeds. The supermarket, however, deducted £3.4 million to cover the “cost of administering donations”, equivalent to more than 10 percent of the total. No other major supermarket made any such deductions, leading senior MPs to urge the group to follow their lead.
“The legislation for the 5p plastic bag charge is clear that the money raised should go to good causes,” said Mary Creagh MP, chair of the environmental audit committee, as quoted by the newspaper. “Five years after the horsemeat scandal and three years after a false accounting scandal, Tesco finds itself again in the spotlight for doing the wrong thing. They should drop this ridiculous charge immediately.”
A Tesco spokesman meanwhile told the newspaper that the group’s administration costs included customer communications and the provision of voting tokens and booths which customers use to choose the charities that are supported, adding that the grocer did not profit from money retained for administration.
As of 14:24 BST, Thursday, 07 September, Tesco PLC share price is 186.00p.