Major international corporations that stayed in Russia after the invasion in Ukraine - including Philip Morris and Danone - made hundreds of billions of dollars in revenue in the country last year, a new report has found, writes POLITICO.

“After Moscow’s full-scale invasion in February, 2022, dozens of international companies pulled out of Russia to safeguard their reputation or protect their business - but those who stayed have since paid billions of dollars to the Kremlin in taxes on their revenues.

The Business of Staying, a report by civil society umbrella group B4Ukraine and the Kyiv School of Economics, found that global corporations raked in $214 billion in revenue in 2022 through their Russian businesses alone - paying $3.5 billion in taxes on their profits.

But those figures are “only the tip of the iceberg, and likely a substantial underestimate of the total tax bill”, according to the report. That’s because taxes paid on employees’ salaries or in the form of VAT are not included in the figures.

The bonanza comes despite the European Union"s efforts to curtail the Kremlin’s revenues by passing 11 packages of sanctions since the beginning of the war.

While most of the revenue came from U.S.-based companies, EU-headquartered companies still earned some $75.2 billion in 2022, paying the Russian government almost $600 million in taxes, according to the report.

All that money, the report argues, funds Russia’s war chest.

“This new data reveals that the business of staying in Russia has been extremely lucrative for several companies that have chosen to stay”, the report reads. “All the more troubling is the extent to which these companies have been paying billions of dollars in profit tax to the Kremlin whilst Putin wages a horrific and unprovoked war on Ukraine”.

The report found that tobacco company Philip Morris made the most revenue last year, at $7.9 billion, and paid $206 million in profit taxes to the Russian government. The company did not respond to a request for comment. Close behind is competitor Japan Tobacco International (JTI), cashing in some €7.4 billion in revenue. A JTI spokesperson said that JT Group had suspended new investments and marketing activities in Russia, but that the company continued to manufacture and distribute products in Russia. “The operating environment remains very challenging”, - the spokesperson said.

“Under these circumstances, the JT Group continues to take necessary decisions to address the changing situation, in compliance with applicable regulations and international sanctions," the spokesperson said, adding that the Russian market generated some $2 billion at today’s exchange rate in 2022 for JT Group, or some 11 percent of its consolidated revenues that year.

Another prominent name in the revenue category is food giant Danone, which posted revenue of some $3 billion, according to the report’s findings.

In response to a POLITICO request for comment, Danone disputed this, pointing to its annual report that indicates that net sales from Russia in 2022 totaled €1.39 billion. A KSE researcher highlighted that Danone controlled two legal entities in Russia, which generated net sales of more than €3 billion together. Danone did not respond to those findings.

The report also finds that Pepsi made some $4.6 billion. Pepsi declined to comment”, - writes the author.