Financial reporting by EU's biggest banks reveals tax avoidance, depriving poor countries of income, says Oxfam
All components of this story
Author: Anna Ratcliff, Oxfam International
Europe’s 20 biggest banks are registering over a quarter of their profits in tax havens...The report, ‘Opening the Vaults,’ suggests the discrepancy may have arisen because some banks are using tax havens to avoid paying their fair share of tax, to facilitate tax dodging for their clients, or to circumvent regulations and legal requirements...Many countries are being cheated out of the money needed to tackle poverty and inequality by corporate tax dodgers, with poor countries being hit the hardest. Tax dodging by multinational companies costs poor countries over €90 billion every year. This is enough money to provide an education for the 124 million children who aren’t in school and fund healthcare interventions that could prevent the deaths of at least six million children. Transparency measures, such as the EU rules on public country-by-country reporting, are vital tools in the global fight against tax dodging. However, a new European Commission proposal designed to extend public reporting beyond the banking sector is flawed. The proposal is limited to companies with a turnover of €750 million or more, a measure that would exclude up to 90 percent of multinationals, and does not require companies to report on their activities in all the countries they operate - including developing countries...
Author: Oxfam & Fair Finance Guide International
...In Europe, only one sector is required to publicly report its profits and tax on a country-by-country basis – the banking sector, as a result of regulation following the financial crisis...This report showcases research by Oxfam that uses this new transparency data in depth for the first time to illustrate the extent to which the top 20 EU banks are using tax havens, and in which ways. Corporations, including banks, have for a long time been artificially shifting their profits to countries with very low, or zero, corporate tax rates...One of the key trends underlying the huge concentration of wealth and income is tax avoidance...[W]hen governments lose tax revenues, ordinary citizens pay the price: schools and hospitals lose funding and vital public services are cut. Alternatively, governments make up the shortfall by levying higher taxes...which impact disproportionally on poorer populations. At the same time, increased profits as a result of lower corporate taxation benefit wealthy companies’ shareholders, further increasing the gap between rich and poor...[Refers to HSBC, Barclays, RBS, Lloyds, Standard Charter, BNP Paribas, Crédit Agricole, Société Générale, BPCE, and Crédit Mutuel-CIC, Deutsche Bank, Commerzbank AG, IPEX, ING Group, Rabobank, UniCredit, Intesa Sanpaolo, Santander, BBVA, and Nordea]