The recent purchase of Boots (pharmaceutical, health and beauty retailer) by the private equity firm Kohlberg, Kravis and Roberts (KKR) was financed with £8 billion worth of debt, which allows KKR to deduct around £500 million in ‘interest expenses’ from the net income of Boots. Given that the taxable income for Boots in 2006 was £480 million, KKR now pay no corporate taxes. Before KKR bought Boots, they paid £130million in corporate tax.

While the money not paid in taxes fills a few bank accounts, it is sorely missed in public services like health, education and housing, While the government tells us to prepare for crisis, some people are ready to make money out of it. As the cost of living sky-rockets, it’s tight belts for us and blue skies for a few.

KKR is one of the oldest and largest private equity firms and currently owns well known companies such as Boots and Toys “R” Us. Through its portfolio companies, KKR is effectively the second largest private employer based in the United States, right behind Wal-Mart. With their massive influence on the economy, KKR and other private equity firms are setting the standards and conditions for millions of workers around the world.

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