Tax haven claims resurface as banks pay 2pc tax on profits
Some of Europe's leading banks with bases here are paying tax at a rate as low as 2pc, according to a new report.
The report from Oxfam, entitled 'Opening the Vault', states that Barclays, RBS and Crédit Agricole paid an effective tax rate here of just 2pc in 2015.
Overall, the report noted that 16 of the top 20 European banks operating in Ireland were paying an effective tax rate of 6pc or less.
That is well below the levels outlined by the Government and IDA when attracting companies here.
Five banks - RBS, Société Générale, UniCredit, Santander, and BBVA - recorded profits here that were higher than their turnover, which, Oxfam says, "potentially suggests that they are artificially shifting profits to Ireland".
A department spokesman rejected the assertions in the report: "We only have and want real substantive FDI, the kind that brings real jobs and investment into Ireland.
"Ireland is also fully compliant with all international best practices in the areas of tax transparency and exchange of information."
Irish officials have steadfastly defended the country's tax regime in the face of criticism following the European Commission's €13bn Apple tax ruling last year amid claims the company received "illegal state aid".
The revelation that many banks are paying an effective tax rate of 6pc or less will not be looked upon favourably in other European capitals.
The report rated Ireland as the fourth worst tax haven in the world, according to banks' reported profits, behind Hong Kong, Belgium and Luxembourg.
Ireland was second only to the Cayman Islands when it came to bank profitability.
The report stated that "the massive profitability levels of European banks in Ireland suggests that large profits may be reported in Ireland as a tax avoidance strategy".
Barclays is singled out for particular scrutiny.
Oxfam said that the bank recorded €900m worth of profits in three countries - Ireland, Switzerland and Luxembourg - but paid just €11m on those profits.
In a statement to this newspaper, the bank said: "Barclays pays corporation tax at the standard corporation tax rate in Ireland and does not have any special arrangements in place."
Spanish bank BBVA was found to have made profits of €27m from turnover of just €12m. The bank has just four employees stationed here.
BBVA said: "The activity of BBVA in Ireland is not comparable to that of the rest of the group since in this country it is dedicated to Investment Banking and Reinsurance, activities that do not require a large number of employees."
The group of 20 leading European banks featured in the report were found to derive 7pc of their collective total turnover and 19pc of their collective total profits from just three countries: Luxembourg, Ireland and Hong Kong.
The banks were found to have just 0.3pc of their workforces situated in Ireland, with "a disproportionately large 2.5pc of their profits" located here.
It said that Ireland had recouped just €129m from the banks on reported turnover of in excess of €3bn in 2015. Recorded profits during the period were €2.3bn.
In a statement, RBS said it "does not take steps to artificially shift profits into the countries alleged to be tax havens in the Oxfam report".
Calls to Crédit Agricole's Dublin office went unanswered.