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Oxfam Report Slams Europe’s Biggest Banks for Using Tax Havens

By
Kevin Lui
Kevin Lui
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By
Kevin Lui
Kevin Lui
Down Arrow Button Icon
March 27, 2017, 4:47 AM ET

Europe’s biggest banks reportedly funneled as much as $27 billion (€25 billion) through overseas tax havens in 2015, according to a report from the anti-poverty NGO Oxfam International.

That’s 26% of the banks’ total profit that year, reported Oxfam—yet just 12% of turnover and 7% of these banks’ aggregate workforce could reportedly be accounted for in these locations. The Oxfam report was based on data released after new EU regulations requiring banks to list their earnings by each country came into force in 2015.

“New EU transparency rules give us a glimpse into the tax affairs of Europe’s biggest banks and it’s not a pretty sight,” Manon Aubry, the group’s senior tax justice advocacy officer, said in a press release.

Focusing on the continent’s 20 biggest banks, Oxfam found that lenders paid no tax on up to $416 million in profits registered in seven tax havens in 2015, with a total of $5.32 billion in profits registered in tiny Luxembourg—more than U.K., Germany and Sweden combined.

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Additionally, $681 million in profits were registered in tax havens where the banks employ nobody at all, according to the report.

The banks’ maneuvers involving tax havens or low effective rates would translate to lost tax incomes for countries that are not havens, argues Oxfam.

“Governments must change the rules to prevent banks and other big businesses using tax havens to dodge taxes or help their clients dodge taxes,” Aubry said. “Tax dodging deprives countries throughout Europe and the developing world of the money they need to pay for doctors, teachers and care workers.”

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By Kevin Lui
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