German companies have paid almost €1.72 billion in taxes to
the Kremlin since Russia’s Ukraine invasion enough to fund 10,000 attack drones
while many still operate in Russia.
There is nothing illegal about the 250 German businesses that are still operating in Russia. In theory, many of these companies that make fast-moving consumer goods like the cheese company Hochland and the gypsum manufacturer Knauf do not break EU laws.
“Companies support Russia’s war economy through the taxes they pay,”
said Nezir Sinani, director of B4Ukraine, a global coalition of civil society organisations seeking to block access to the economic resources behind Russia’s aggression.
Nonetheless, the critics contend that funding the Kremlin's war chest is a problem that needs to be resolved.
He contends that they are directly supporting the Russian economy by staying in the nation, which makes them complicit in Russia's aggressive war.
“These foreign companies are clearly continuing to contribute to the Russian economy and thereby supporting the war,”
said Sinani.
“This is a loophole that must be closed,”
he emphasised.
International businesses who continued to operate in Russia paid the Russian government at least $20 billion (€17.2 billion) in taxes in 2024 alone, according to a report by the Kyiv School of Economics (KSE), B4Ukraine, and Squeezing Putin Initiative. Among them are German businesses.
The sum has surpassed $60 billion (€51.8bn) since Russia's full-scale invasion of Ukraine in early 2022.The scale is demonstrated by the following example: Russia pays roughly $18,400 (€16,000) every contract to enlist one person for military duty in the conflict against Ukraine, according to B4Ukraine.
According to the International Institute for Strategic Studies, the $60 billion is roughly half of Russia's $145 billion (€125 billion) 2025 defense budget, which is sufficient to pay for more than a million Russian soldiers.
What EU measures limit companies' tax contributions to Russia?
The European Union has enforced a comprehensive set of
warrants aimed at confining profitable relations that could contribute to
Russia’s war trouble, which laterally limit companies’ duty benefactions to
Russia.
Bans on the purchase, import, and transfer of Russian crude oil painting, meliorated oil painting, coal, solid reactionary energies, and thawed petroleum gas. proscriptions on exports of goods, technology, and binary- use particulars that could enhance Russia’s defense, security, or artificial capabilities.
Restrictions on dealings with Russian state- possessed realities, including major energy companies similar as Rosneft and Gazprom. Bans on fiscal deals with the Russian central bank and limits on deposits, loans, and credits to Russian institutions.
Enhanced import controls to help endurance, including conveyance proscriptions and blacklisting of companies abetting Russia.