US cos. pay over $1 bln in taxes to Russia amid ongoing war in Ukraine, according to new report
US companies pay over $1 billion in taxes to Russia amid ongoing Ukraine war, 11 January 2025
US companies that have continued to do business in Russia have contributed more than $1 billion in tax revenue to Kremlin, Newsweek has learned.
American firms in Russia paid the country $1.2 billion in profit taxes in 2023, according to figures from campaign group B4Ukraine and the Kyiv School of Economics (KSE) Institute...This tax contribution makes the U.S. the largest contributor of foreign profit taxes to Russia...
According to the new research, the 10 companies that paid the most profit taxes to Russia in 2023 were tobacco company Philip Morris International ($220 million), beverage corporation PepsiCo ($135 million), confectionary company Mars ($99 million), health and hygiene consumer goods firm Procter & Gamble ($67 million), confectionary company Mondelez ($62 million), investment bank Citigroup ($53 million), agricultural company Cargill ($50 million), pharmaceutical firm Johnson & Johnson ($42 million), independent soft-drink bottler Coca-Cola Hellenic ($34 million) and oilfield service company Weatherford ($32 million)...
Mark Temnycky, a non-resident fellow at the Atlantic Council think tank's Eurasia Center, called on Congress to "impose stiffer financial penalties" on U.S. companies that remain in Russia, arguing that they "boost the Russian economy," enable Moscow to purchase weapons and military equipment and undermine "the impact of international sanctions."
"It indirectly rewards Russia for its invasion of Ukraine as it implies that invading another country is normal and that business can remain," he told Newsweek.
"Shutting down additional Western and American businesses within Russia would generate less revenue in the Russian market, and it would weaken the Russian economy. Russia would then have fewer funds to purchase weapons and defense equipment for its war, and this would lead to a quicker end to the invasion as Russia would no longer have the economic means necessary to finance the war."
Hilary Ingham, professor in economics at the University of Lancaster in the U.K., said that U.S. companies may be shoring up Russian support for the war by giving its citizens access to Western goods.
"It is conceivable that popular support for the war amongst Russians might be severely hampered if they are unable to purchase U.S. goods," she told Newsweek.
Aside from the U.S., the second-largest contributor of profit tax to the Kremlin in 2023 was Germany as companies paid $693 million in tax to Russia. Austria came in third, with firms paying Putin's regime $579 million in profit taxes.
Despite pressure, leaving Russia is not without its problems. The Russian government charges companies that leave the country a 15 percent exit tax and are forced to sell their assets at a 50 percent discount. The exit tax generated $385 million for the Kremlin between January and March 2024...