UK Companies “Addicted” to Tax Havens
LONDON – New research shows that nearly one quarter of the UK’s largest companies make use of subsidiaries registered in tax haven jurisdictions.
On October 11th the international development charity ActionAid released a new report, entitled Addicted to tax havens, which aimed to provide the first comprehensive analysis on the use of subsidiary companies by UK businesses listed on the FTSE 100.
The report found that 98 of the 100 biggest companies on the FTSE make use of subsidiaries registered in jurisdictions that are regarded as tax havens. In total, the 100 companies have 34 216 subsidiaries, with 8 492 of the entities being located in tax havens.
The banking sector made the most use of subsidiaries registered in offshore financial centers, with the country’s four largest banks holding 1 649 subsidiaries in tax havens. Resource extraction companies were also significant users of entities in tax havens, with BP and Shell alone holding almost 1000 such companies between them.
Delaware was the most prominently used tax haven jurisdiction amongst the investigated companies, with nearly 2 461 subsidiaries being registered in this US state. The Netherlands were the second most popular jurisdiction, accounting for nearly 1 400 registrations.
The new research is based on data that was previously undisclosed by the FTSE listed companies. Last year ActionAid held an investigation into the use of subsidiaries by large UK entities, and it was found that many companies had not fully reported their offshore subsidiaries. The new data was made available when the UK Companies House requested the involved enterprises to re-file their annual returns and provide information on their registered subsidiaries.
Photo by milena mihaylova