It's a scandal that oil and gas giants are able to rake in billions in unearned profits off the back of Trump and Netanyahu’s illegal war.
Three MPs from across the progressive political parties have demanded action from the British Government after The Ecologist revealed that the British territory Bermuda is at the centre of worldwide oil industry tax dodging.
The Labour MP Clive Lewis responded to revelations published here by submitting a motion to Parliament, calling on the Foreign Office to launch an investigation into how it can stop British territories being used by the oil industry to shield the record profits they are receiving as result of Iran war oil price hikes from tax.
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The investigation has been co-published by The Ecologist, the Byline Times and the Abolish Westminster newsletter and has revealed, among other things, that Bermuda is at the centre of the global oil industry’s tax avoidance strategy.
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Symptomatic
The report showed that the British Overseas Territory hosts the headquarters of three of the world’s top ten oil drilling contractors, four of the world’s ten biggest oil tanker companies, Shell and Chevron offices, and the in-house insurance provider for Saudi Aramco, the world’s biggest oil company.
Research by Global Witness shows that the world’s top 100 oil and gas companies banked more than $30m every hour in unearned profit in the first month of the US-Israeli war in Iran, as a result of soaring prices. As our investigation confirmed, many of those companies use British territories to avoid tax on these profits.
Mr Lewis, the MP for Norwich South, said: “Rachel Reeves will introduce some kind of windfall tax - under pressure, because of war profits. What that is, is a smoke screen. She’s saying ‘I will deal with the symptoms, not the structural causes’.
“Increasingly, people are beginning to see this - unless we begin to address what is, in reality, an industrialised tax avoidance scheme, we will never get to grips with the climate crisis or inequality in this country.”
If such a windfall tax is introduced, he said, it “will have been agreed with the oil companies” in advance. “Where is the structural tax reform? Where is the closing down of British tax havens? This is symptomatic of the wider crisis - an extractive economic system which has run its course.”
It's a scandal that oil and gas giants are able to rake in billions in unearned profits off the back of Trump and Netanyahu’s illegal war.
Unearned
Andrew George, the Liberal Democrat MP for St Ives, has also called for action. He said British territories being used for oil industry tax avoidance was “completely unacceptable. I’m concerned such activities happening under the UK brand is undermining the reputation of this country. It all seems to be happening in the political shadows.
“I’m not interested in the politics of envy, it’s about justice and decency,” he said.
While the companies involved “aren’t breaking any rules, they are rather cynically exploiting the opportunities available to advantage themselves” and “clearly making a mint,” he added.
“Parliament needs to turn its attention to what’s happening beyond our shores, but in our name,” he said. “We’re interested in the Chagos islands at the moment - there’s no reason why we can’t turn our attention to and take on this, too. We can’t bestride the globe lecturing others if we don’t get our back yard in order,” he concluded.
Dr Ellie Chowns MP, leader of the Parliamentary Green Party, said: “It's a scandal that oil and gas giants are able to rake in billions in unearned profits off the back of Trump and Netanyahu’s illegal war, funnel the spoils through British offshore territories, and then dodge the tax bill - all while ordinary people across Britain struggle to cope with rising energy costs.
Corporations
"No company should be able to pocket obscene profits from a global crisis, especially when those very same companies are responsible for polluting our planet and ushering in climate breakdown.
"The government must take every action to crack down on oil and gas profiteering and ensure British territories are not able to be used as tax havens for the oil industry to avoid paying their fair share.”
The report also revealed that Shell declares 11 per cent of its turnover in the Bahamas. While the Bahamas are no longer a British territory, they were set up as a tax haven by Britain before they gained independence, and their highest court of appeal continues to be the Judicial Committee of the Privy Council, meaning that Shell’s assets are ultimately protected by British judges.
The report further looked at how the UK’s own tax regime is highly beneficial to big corporations in general, and the oil industry in particular, leading to Shell relocating its HQ from the Netherlands to London in 2022, with multiple experts describing the UK itself as a ‘tax haven’.
This Author
Adam Ramsay is an investigative journalist. He publishes the Abolish Westminster newsletter. Read more from our special series, Big Oil and the British State.
