European banks profited €25bn from tax havens
The continent's top 20 lenders avoided paying tax on an estimated €25 billion, the study finds.
The report follows increased international scrutiny of corporate tax avoidance.
The lenders paid no tax on profits of €383 million posted in seven tax havens last year while booking earnings of €4.9 billion in Luxembourg – more than they did in the UK, Sweden, and Germany combined.
In 2015 European banks posted at least €628 million in profits in tax havens where they employ nobody, Oxfam reported. Luxembourg and Ireland are the most favored tax havens, accounting for 29 percent of the profits banks posted offshore in 2015.
“The French bank BNP Paribas made €134 million tax-free profit in the Cayman Islands despite having no staff based there,” explained the report.
The report also showed some banks were reporting profits in tax havens while reporting losses elsewhere. Germany’s Deutsche Bank registered small profits or losses in many major markets in 2015 while booking almost €2 billion in profits in tax havens.
Bank employees in tax havens appear to be four times more productive than the average bank employee, Oxfam said.
They generate an average profit of €171,000 per year compared to just €45,000 a year for an average employee, the organization calculated. ■