Global companies operating in Russia generated an impressive $213.9 billion in revenue from their local business ventures. Among these substantial earnings, an estimated value of $14.1 billion translated into profit, demonstrating the financial success achieved by these multinational corporations, while contributing to the Russian economy by paying $3.1 billion in profit tax.
The recent release of “The Business of Staying” report by B4Ukraine and the Kyiv School of Economics (KSE) sheds new light on the performance of multinational businesses in Russia and explores for the first time the income and profit, big multinational corporations produce within the country.
In their report B4Ukraine and KSE also wrote that these businesses continue to pay taxes in Russia, which serves to underwrite the conflict and damage of humanitarian and human rights law that are currently occurring in Ukraine.
Drawing upon extensive data gathered from the KSE and the Russian company register, the report estimates that businesses with headquarters in European Union (EU) member states generated an astonishing $75.2 billion revenue in 2022 and paid $594 million profit tax.
Meanwhile, on a country basis ,U.S. businesses collected the largest revenue in Russia and became the biggest contributors to the Kremlin’s coffers through taxes on profits, paying $712 million in 2022, followed by Germany, which paid $402 million profit tax to Russia in 2022.
Businesses with headquarters in G7 and EU nations together paid the greatest earnings taxes in Russia, accounting for 16 of the top 20 country donors in 2022.
Fast- moving consumer goods (FMCG) and Automobiles saw the biggest revenue share. FMCG is the second-highest revenue generating sector in Russia with revenue generated of more than $21 billion in 2022.
Unilever, Danone, and Nestlé are three prominent European brands that have opted to remain in Russia despite having curtailed some of their operations since the invasion.
Companies frequently cite defense as an ‘essential’ nature of the products they offer in Russia. However, some are expanding the definition to include products like shampoo, aftershave, and confectionery. When questioned by B4Ukraine, many of these companies refused to disclose their criteria for determining which goods are essential or non-essential.
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