Biggest public shipping firms post record profits, pay less than half average tax rate

New figures released from climate change NGO Opportunity Green claim profits on an “extraordinary scale” have been made by leading shipping companies in the years since the pandemic.

The world’s 139 largest shipping companies – accounting for 90% of the world’s fleet – made almost US$340.0Bn in profits from 2019-2023, the last year for which full figures are available. Of this sum, 93% was taken by the top 10 largest companies, the report says.

“The pandemic created an enormous windfall for shipping companies as the easing of lockdown restrictions caused a spike in global demand for freight, pushing prices up to record levels. But freight prices have soared again since 2023, as a result of disruptions to global shipping routes including drought restrictions on the Panama Canal and attacks by the Houthis on ships in the Red Sea. As freight prices have risen, so have shipping company profits,” the report said.

It added, “Yet despite these record earnings, shipping company taxes have remained catastrophically low and many of the world’s biggest shipping companies are failing to pay their fair share of taxes.”

It said the top 10 largest companies paid only US$30.0Bn in tax from 2019-2023, at a tax rate of around 10%. The report said this is below the global corporation tax average rate of 21%, and below the new Organisation for Economic Co-operation and Development (OECD) global minimum tax rate of 15% (from which shipping is exempt).

“Following intense industry pressure, the OECD granted shipping companies an exemption from its minimum corporation tax rules, which applies a global minimum corporation tax of 15%. The report shows the problem is biggest in the largest and most profitable companies, with nine of the top 10 from high income developed economies and four of those headquartered in wealthy OECD member states. Over 2019-2023, members of the OECD have an average tax rate on shipping companies of around 4%, compared with a rest of the world average of 16%.”

A statement said, “The top three publicly listed European shipping companies, Maersk, CMA CGM and Hapag Lloyd, paid only $4.6Bn in taxes in total over five years, despite making nearly half of all profits globally (US$137.0Bn). Had the top 10 largest shipping companies paid the average rate of tax faced by other companies in their home countries, the additional tax raised would have been US$42.0Bn.”

Economics at Opportunity Green senior director James Meadway said, “This is a shameful set of statistics, and shipping companies must change course, start paying their fair share of taxes and get on board with the true impact their operations are having on the planet. The international shipping sector is a significant contributor to climate change, producing 1Bn tonnes of greenhouse gas (GHG) emissions each year, but nowhere is this felt more acutely than in the Global South, where frontline countries are bearing the brunt of the climate crisis. Four of the world’s largest shipping companies, headquartered in the richest countries, paid just US$5.0Bn in taxes – an all-time low tax rate of only 3%. If these four companies alone were taxed at the same rate as other big corporations where they are headquartered, more than US$38.0Bn extra in taxes would have been raised over those five years.”

Opportunity Green chief executive and founder Aoife O’Leary said, “These figures should act as a stark warning as member states from all over the globe gather at the International Maritime Organization to discuss the possibility of a levy on international shipping emissions. The shipping industry currently produces 1Bn tonnes of GHG emissions each year, and yet it continues to dodge paying fair taxes. It now has the unique chance to put that right by becoming the first industry to introduce a global levy and raise revenues that could be directed to deal with the worst of climate change in climate vulnerable countries.”

The top 10 largest shipping companies are Moller-Maersk, CMA CGM, Hapag-Lloyd, China COSCO, Ocean Network Express, Evergreen Marine Corp, Orient Overseas, Yang Ming Marine Transport Corp, Wan Hai Lines and SITC.

A statement said all 10 companies were contacted for their responses to the figures in the report. Of these, Wan Hai Lines, Maersk and Orient Overseas responded to confirm the figures provided about their company are accurate. No replies were received from the remaining top 10 companies. The world’s largest shipping company at the time of writing is MSC, a privately held Swiss company that does not publish its accounts.