All major tech companies operate in European tax havens
22:36
Until now, tax havens have been associated with remote islands in the Caribbean Sea with very low tax rates. The capital was transferred to such far-flung places as to bring the tax base down to almost zero. However, due to international regulations, e.g. reporting at the level of each country on corporate influence, this type of activity has been forgotten for several years. On the other hand, European tax havens persist – that is, for example, Ireland or the Netherlands. Each year, Ireland records higher CIT revenues, i.e. corporate income tax, by approx. 67 percent, and the Netherlands by 37 percent. In Ireland, the corporate tax rate is very low – 12.5 percent.
"Ireland allows for special optimization mechanisms – the so-called profit transfer, which can further lower the tax base. Virtually all the largest, global, digital companies are registered in European tax havens," Łukasz Błoński, an expert of the Polish Economic Institute, said.
"The third type of tax havens that still operate in the European Union are countries that sign special agreements with international corporations. An example of such a country is Luxembourg. In Luxembourg, the European branch of Amazon – an American trading company operating the world's largest online store – has its tax headquarters. Amazon, despite huge profits recorded in 2020, did not pay a single euro in CIT in the entire EU. Moreover, it made a loss – and as a result, got a tax write-off that can be amortized for current operations," Błoński added.
