Press Release, March 25, 2011
Coalition against Bayer Dangers (Germany)

less taxes despite record profits:

BAYER appearing poor to tax authorities

BAYER is carefully adjusting its accounting in order to appear poor to the tax authorities. The company thereby reduces its corporation tax burden at the expense of the taxpayer. The fact that BAYER now hardly contributes to community financing is unacceptable.

BAYER’s actual profit last year was over €7 billion, an increase of nearly 10 percent on the previous year. Sales even rose by 12 percent. In its Annual Report BAYER announces a profit ratio of 20.2 percent for 2010. Accordingly, shareholders again will receive a higher dividend: €1.16 billion compared to €973 million for the previous year.

At the same moment BAYER’s tax payments are getting less and less. Between 1997 and 2000, the company was still paying the equivalent of about €1 billion a year in corporation tax, but in 2009 tax payments dropped to €511 million and now in 2010 to €411 million. In this way the company is steadily abdicating its responsibility towards the general public at the expense of taxpayers, who have to pay the bill through rising taxes and levies.

Axel Koehler Schnura, board member of the Coalition against Bayer Dangers which has been monitoring BAYER for more than 30 years, says: “It is an unacceptable scandal that an enterprise like BAYER is providing less and less financial support to the community. It is immediately obvious that taxes of 411 million Euro do not even cover the infrastructure, administration and monitoring costs that the company is causing”.

In BAYER’s financial statements items are shunted around freely. The report hardly provides meaningful information. The company is recruiting experts who often come directly from the fiscal authorities to its tax department, attracted by higher salaries. Together with the corporate lobby, BAYER has ensured the passage of tax legislation that literally poses a threat to the general public.

In the past year BAYER has made write-downs of €1.7 billion to diminish its profits. Apart from the write-down made because the company is giving up the Schering brand name, taxes are also being saved by deducting legal costs for defending the company against claims for damages from victims of medicines. This enables BAYER to make itself appear poor to the tax authorities and to reduce its tax burden, even when profits are soaring.

Things have taken their usual course: The German corporate tax reform of 2001 already played a significant role in reducing the taxes paid by the group. From that time onwards, BAYER paid no trade tax or corporate income tax at all for years. The “golden” law that made this possible was drafted by Heribert Zitzelsberger, a BAYER man from the tax department, whom the company dispatched to the Finance Ministry.

Axel Koehler Schnura continues: “The Board of Management is responsible for “Bayer´s 1000 tax dodges”. Therefore we propose that the actions of the board shall not be ratified at the upcoming Bayer shareholder meeting”.

Countermotion to Bayer´s Annual Stockholer Meeting