Benefits in Corona Crisis: Profit Booster Corona Crisis (current nd)



November 28, 2021

For years, the Mainz-based company Biontech suffered losses. From the onset of the corona pandemic to the third quarter of 2021, however, profits of € 6.4 billion have accrued.

Photo: dpa / Boris Roessler

Germany faces new containment. In some areas, Christmas markets, restaurants and cinemas are already closed. The retail trade suffers from strict regulation. While some struggle to survive financially, others really benefit from it. The corona pandemic has been and is a profit accelerator for many companies. A study released on Friday by Charles University in Prague, which was commissioned by the left-wing faction in the European Parliament, shows how much business has gained in the process.

This is the first study to comprehensively calculate the crisis profits of multinational companies operating in the EU for the year 2020. As a result, companies have raked in profits of around 364 billion euros which will go beyond normal. While American companies such as Amazon, Apple and Facebook recorded pandemic profits of 100 billion euros, German companies gained an additional 15 billion euros, French companies reached 20 billion.

The golden times are now also for pharmaceutical companies which continue to make fantastic profits. German company Biontech made a net profit of around 3.2 billion euros between July and September of this year alone. According to estimates from the People’s Vaccine Alliance, Biontech, Pfizer and Moderna will collectively earn around $ 30 billion from their corona vaccines this year, as they focus on rich countries and ignore poor countries. According to this document, at the end of August, “99% of previous deliveries of Biontech / Pfizer were destined for high and upper middle income countries”, as critic Amnesty International.

So, while companies reap gigantic profits, many countries have continued to borrow in order to contain the consequences of the pandemic. In Germany alone, the federal debt increased by 450 billion euros because of the corona. According to the European statistical agency Eurostat, the debt ratio of countries in the euro area climbed to almost 100% on average during the crisis.

Someone will have to foot the bill. Why not those companies that made fantastic profits during the crisis? The left-wing faction in the European Parliament, The Left, is now demanding a tax on the additional profits that have been made as a result of the pandemic. “It is high time for businesses to do their bit,” parliamentary group leader Martin Schirdewan said on Friday. German companies such as Lufthansa, BASF and VW received billions in government aid during the crisis. While sending their employees on short-time work, they continued to generate substantial profits. Never before in history has short-time work been requested for so many people – more than ten million employees have sometimes received their money from the Federal Employment Agency. “We are talking about Dax companies that together hold thousands of investments in tax havens, that is, take tax money out of the country and in return receive taxpayer support,” Schirdewan said.

Such an excess tax on profits is not a left-wing utopia. In the past, such taxes existed in countries like the United States, Canada, France or Italy. The Tax Justice Network refers to the United States and Great Britain: “During World Wars I and II, the United States taxed up to 95% the additional profits of the arms industry and co. . Britain also introduced high taxes on excess profits. “

In Germany, an additional tax on the profits of crude oil and natural gas had already been mentioned during the oil crisis of 1973. Moreover, the Greens were still in favor of such a special tax in the spring. “I think it is fair and important that those who have particularly benefited from this crisis also make their additional contribution”, underlined in March the financial spokesperson of the parliamentary group Green, Lisa Paus, vis-a-vis “Tagesschau”.

“Coalition negotiations are now an opportunity for the Greens to initiate a levy for the winners of the crisis in the EU,” said Schirdewan. But there is no reference to this tax in the coalition agreement. The current partners of the SPD and FDP coalition had already spoken out against the tax in the spring. Corona debt must be financed by economic growth.

But what could such a tax look like? The Tax Justice Network considers the so-called average earnings method to be practicable. In doing so, a profit would be determined for the respective company ”, which, on the basis of a specified past period, is considered normal. Any additional profit generated during the crisis fiscal year is subject to excess profit tax ”. Such a tax would be relatively easy to collect. And that would actually bring billions of dollars in revenue to the public sector, as the Prague study shows: with a tax rate of 70% on the profits of the crisis, more than a third of the fund’s annual budget development of the EU. Next Generation EU ”could be covered. With a tax rate of 70%, Germany could post additional income of more than ten billion euros per year. But there is a lack of political will.



Comments are closed.