The major European banks continue to take advantage of tax havens to fill their coffers.
That’s according to a report by the anti-poverty charity Oxfam, published on Monday.
It concluded that 20 major European banks make a quarter of their profits, or 25 billion euros in these low tax jurisdictions.
Amongst the banks Oxfam scrutinised were HSBC, Barclays, RBS, BNP Paribas and Crédit Agricole.
It found that whilst the banks declared 26 percent of their profits from tax havens they recorded only 12 percent of their turnover from them and just 7 percent of the banks’ employers were based in these territories.
By 2015 these banks were earning 628 million euros in profit
from tax havens were they had no employees at all.
BNP Paribas for example earned 134 million euros tax-free in the Cayman Islands where none of its staff are based.
And on the productivity of the twenty banks’ employees, the figures speak for themselves,
In tax havens their productivity is four times higher on average,171,000 euros per year, compared to 45,000 euros per year elsewhere.
Oxfam found that the three preferred tax havens were Hong Kong, Ireland and Luxembourg where these banks gained 4.9 billion euros in 2015;
And in Ireland five banks – RBS, Societe Generale, UniCredit, Santander and BBVA – achieved more than 100 percent in profit.
Luxembourg and Ireland, the two EU members, account for 29 percent of the profits the banks earned in tax havens.
New EU transparency regulations that require banks to publish the profits and taxes they pay in each of the countries where they operate made this research possible Oxfam says.
And it’s now calling for those regulations to cover all business sectors, and not just banks.
Oxfam hopes the increased tax revenues can then be spent by governments on vital services such as education and health.