Corporate profit shifting linked to the United Kingdom and its network of Overseas Territories and Crown Dependencies is associated with an estimated €8 billion in annual tax losses across the European Union, according to analysis by the Tax Justice Network.
The estimate forms part of the organisation’s updated Corporate Tax Haven Index, published on 5 November 2026. The figures concern multinational companies and are based on data for 2022, the latest year available for the EU country breakdowns.
What the analysis says about EU tax losses
The Tax Justice Network estimates that EU countries lose approximately €59.3 billion each year when multinational companies shift profits across borders. Around €8 billion of that total is linked to the UK’s tax haven network, equivalent to 13.6% of the EU-wide estimate.
Profit shifting can involve recording income in jurisdictions with lower tax rates instead of the country where the economic activity occurs. Companies may also use payments such as royalties, interest or other intra-group charges to reduce taxable profits in higher-tax jurisdictions.
The OECD has said that many profit-shifting arrangements are legal, although some practices may breach tax rules. It has also warned that these arrangements can weaken tax fairness and reduce government revenues.
Which EU countries are estimated to lose the most?
France and Germany account for the largest estimated losses in the analysis. Combined, their losses reached €24.9 billion in 2022, representing around 42% of the EU total.
- France: €13.1 billion
- Germany: €11.8 billion
- Spain: €4.8 billion
- Poland: €4.7 billion
- Belgium: €4.1 billion
- Italy: €3.6 billion
- Netherlands: €3.5 billion
- Luxembourg: €3.2 billion
The estimated loss exceeds €1 billion in Ireland, Sweden and Austria. Ireland’s figure is put at €2.2 billion. The Tax Justice Network stresses that the estimates relate to multinational corporate profit shifting, not undeclared income held by individuals.
The smallest estimated losses were recorded in Lithuania, Malta, Latvia, Estonia and Croatia, each below €100 million. These figures should not be interpreted as a measure of overall tax avoidance or evasion in each country.
How much is linked to the UK network?
The analysis estimates that the UK network is associated with €2.8 billion of France’s corporate tax losses and €1.4 billion of Germany’s. The French figure represents 21.3% of the country’s estimated losses, the highest share among EU member states.
Other estimated losses linked to the network include:
- Luxembourg: €570 million
- Spain: €475 million
- Poland: €438 million
- Italy: €438 million
- Belgium: €415 million
The figures describe an estimated connection between profit-shifting activity and jurisdictions in the UK network. They do not establish that individual companies or governments have acted unlawfully.
British jurisdictions dominate the tax haven index
The Corporate Tax Haven Index assesses how jurisdictions’ laws, regulations and financial activity may enable multinational companies to reduce tax liabilities elsewhere. It combines an evaluation of the tax and legal framework with the scale of foreign investment flows.
Four British jurisdictions appear in the index’s top 10: the British Virgin Islands, the Cayman Islands, Bermuda and Jersey. Guernsey and the Isle of Man are also placed in the top 20, while the United Kingdom is ranked 19th.
According to the index, the UK and six associated jurisdictions account for 31% of identified global corporate tax abuse risk. When Gibraltar, Anguilla, the Turks and Caicos Islands and Montserrat are included, the combined share rises to 33.3%.
The Crown Dependencies set their own tax rules, while tax policy in the British Overseas Territories is generally determined locally. The UK retains certain constitutional powers, although domestic taxation is normally handled within the territories themselves.
The UK is also estimated to lose tax revenue
The Tax Justice Network places the UK among the countries experiencing the largest losses from corporate profit shifting. It estimates that the UK loses £12.8 billion, or approximately €14.7 billion, annually as multinational profits are shifted to tax havens worldwide. That figure is an annual average covering 2018 to 2022.
This highlights the complexity of international tax arrangements. A jurisdiction can be associated with tax-planning structures used elsewhere while also losing revenue when companies shift profits away from its own tax base.
Why the figures matter for European governments
The estimates have implications for public finances, corporate taxation and international tax negotiations. Lost revenue can reduce the resources available for public services or increase pressure on governments to raise money through other taxes.
The Tax Justice Network argues that international efforts have not yet delivered all the information tax authorities need to identify profit shifting. It has called for stronger transparency requirements and greater cooperation between countries.
The figures also come amid wider debate over the proposed United Nations tax convention. The Tax Justice Network says the UK and EU could benefit significantly from reforms, while criticising their approach to international tax competition. Those are the organisation’s stated views, rather than an agreed EU policy position.
What does this mean for Ireland?
Ireland’s estimated corporate tax loss is €2.2 billion in the 2022 analysis. The figure provides a measure of estimated profit-shifting exposure, but it does not describe the conduct of particular Irish companies or amount to a finding of unlawful activity.
For Ireland, the issue is especially relevant because international corporate taxation affects government revenue, the competitiveness of the single market and relations between member states. Any future EU or international agreement would require careful consideration of national tax powers, business reporting obligations and enforcement cooperation.
Conclusion
The Tax Justice Network’s analysis links about €8 billion in annual EU corporate tax losses to the UK’s network of tax havens, while estimating total EU losses at €59.3 billion. The figures are estimates rather than legal findings, but they underline why corporate taxation remains a major issue in European economic policy. The next steps will depend on international negotiations and whether governments adopt stronger transparency and enforcement measures.