EU tax revenue losses to multinational profit shifting

Reports from the Tax Justice Network highlight significant tax revenue losses within the European Union due to multinational corporations transferring profits to low-tax jurisdictions.

An analysis of the period between 2016 and 2023 indicates that US tax policies, specifically corporate tax cuts and incentives, cost Germany more than €23 billion in revenue. This loss was distributed across German municipalities, the federal government, and individual states. The study suggests US corporations shifted €327 billion in profits out of EU states during this timeframe, contributing to a total loss of at least €86.4 billion for European public budgets.

Broader findings indicate that EU member states lose approximately 60 billion euros annually to tax havens. Germany and France face the largest annual losses, at roughly 11.8 billion euros and 13.1 billion euros respectively. Other nations reporting significant losses include Spain, Poland, Belgium, Italy, and the Netherlands. Additionally, approximately 8 billion euros of these losses are linked to British territories such as the Cayman Islands, Bermuda, and the British Virgin Islands.