Coca-Cola, McDonald's forgo Olympics tax break

Two American corporate giants have decided to pass up an Olympics tax break.

Olympic Park in London will be a tax haven for the duration of the summer games thanks to special tax rules included as part of the original bid. That means sponsors could pay no tax at all on earnings generated in the Olympics.

But McDonald's and Coca-Cola say they will pay tax on the money they earn in connection with the U.K.-based competitons, reports Calum Fulkler in Accountancy Age.

Her Majesty's Revenue and Customs says the tax break is available to all foreign nationals. This includes not only corporate entities, but also athletes themselves, judges, journalists and any other international workers associated with the Summer Games.

The tax relief is not available to United Kingdom companies.

The possibility of losing so much money prompted protests in the U.K., including one by the group 38 Degrees, which collected more than 150,000 signatures urging sponsors to waive their rights to the tax relief.

The cost of declining the break is expected to be minimal for the two iconic corporate giants.

But the goodwill that the move will generate among the host country's citizens is likely to provide a big public relations and goodwill payoff.

Now if the Brits could do something about those weird Olympics mascots!

London Olympics 2012 mascots via iStock

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