Taxes are a sensitive issue, especially at a time of financial “holes” in state budgets dug by the pandemic
Leading European banks continue to use tax havens to report large profits. The trend has changed little since 2014, despite the obligation to publish information on activities in each country, the European Tax Observatory said in a report published today and quoted by Reuters.
Reports from 36 major European banks show a total profit of 20 billion euros ($ 23.77 billion), or about 14 percent of their total profit in tax havens, even though there are few employees in those countries, according to the independent research organization co-financed. from the EU.
The profits reported by banks in tax havens are about € 238,000 per employee, compared to € 65,000 in countries that are not classified as tax havens.
This suggests that the profits reported in tax havens are mostly amounts transferred from other countries where banking services are provided, the report said.
Taxes have become a sensitive issue amid the financial loopholes that the Kovid-19 pandemic has left in public finances. Governments are trying to negotiate a common tax rate for large corporations, mostly in the technology sector.
The obligation to disclose information on the activities of financial institutions country by country, which aims to shed light on the internal functioning of banks, has failed to change their behavior despite the rise of tax issues at the top of the public agenda, note the authors of the report.
More ambitious initiatives, such as a global tax minimum of 25 percent, may be needed to reduce the use of tax havens by the banking sector, the document concludes.
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