Leading European banks save money in tax havens, where foreign companies are extremely tax-advantaged. They record approximately 20 billion euros (507 billion crowns) annually in tax havens, which corresponds to 14 percent of their total profits.
–
This emerges from an analysis by the EU Tax Observatory, which focuses on 36 large banks that have to report publicly on their activities by country. These include the British financial houses Barclays, HSBC and NatWest, which was renamed the Royal Bank of Scotland last year. Or the French BNP Paribas and Société Générale, to whose group the Czech Komerční banka belongs.
–
Thanks to tax havens, these banks enjoy a particularly low income tax, which according to the EU Tax Observatory does not exceed 15 percent.
–
A spokesman for HSBC said the bank did not evade tax obligations. Bank Barclays server The Guardian The Bank stated that the Bank is the fifth largest taxpayer in the United Kingdom and pays taxes in all jurisdictions in which it operates.
–
Many activists see the fact that banks are taking advantage of tax havens as a problem. At the time of the financial crisis in 2008, more than EUR 1.5 trillion in taxpayers’ money was used to rescue banks in Europe.
–
Following this year’s meetings of the Organization for Economic Co-operation and Development (OECD), 130 countries have supported a global 15% minimum tax rate for multinational companies. US President Joe Biden originally proposed a single rate of 21 percent, but did not push through the proposal.
–
In the world’s seven largest economies, the lowest corporate tax rate is currently 25 percent. According to a report by the EU Tax Observatory, with such a high tax, the banks included in the research would have to pay ten to 13 billion euros a year in additional taxes. Lower taxes would reduce the collection to six to nine billion euros at a rate of 21 percent and to three to five billion euros at a rate of 15 percent.
–
With a minimum tax, most tax revenue will come from British banks.
–
If any global minimum tax rate were imposed on European banks, the British Treasury would benefit most, partly because of the size of the country’s banks. “We have found that with a minimum tax, most tax revenues will come from British banks,” the report writes Have European Banks Left Tax Havens?.
–
At a global 15% tax rate, the United Kingdom would collect an additional € 940 million per year in 2020 (if banks reported profits in the country) and € 1.47 billion in 2019. Britain currently has a rate of 19 percent.
–
In recent years, more and more multinational companies have avoided tax obligations in other countries. As a result, other countries will lose 427 billion euros a year, according to the study.
–
The study also highlighted the high profitability of banks in tax havens. The reported profits in them amount to approximately 238 thousand euros per employee, while in other countries only 65 thousand euros.
–
The percentage of profits settled in tax havens has not changed in the last seven years. Eight banks even increased the number. These include Monte dei Paschi di Siena (by 19.4 percent), Intesa Sanpaolo (by 12.2 percent), HSBC (by 7.9 percent), Barclays (by 4.3 percent), Nordea (by 2.1 percent). percent), BBVA (up one percent), Banco Santander (up 0.8 percent) and Rabobank (up 0.7 percent). In the case of NatWest and Intesa Sanpaolo, the change was allegedly caused by losses in non-trading markets.
–
One of the world’s largest banks, HSBC, accounts for ten percent of the total profits of the 36 banks surveyed. The British bank accounts for almost 60 percent of its profits in Hong Kong, where the tax rate is 11 percent.
–
“Hong Kong is one of the most important cities in China, and due to the history and size of HSBC’s operations and strategy, a significant portion of the group’s profits continue to be generated in Hong Kong, where we are the largest bank with approximately 30,000 employees,” said a bank spokesman.
–
Tax havens where banks direct their profits also include the Bahamas, Bermuda, the British Virgin Islands and the Cayman Islands, where the tax rate is zero. Guernsey, Gibraltar, Hong Kong, Ireland, the Isle of Man, Jersey, Kuwait, Luxembourg, Macao, Malta, Mauritius, Panama and Qatar. Luxembourg has the highest rate of these countries at 15 percent.
—
