While the little guy continues to pay taxes while working two jobs and still struggles to meet rent, the largest, wealthier elites of the world are hiding their fortunes in tax havens. Forget last year’s leak of the Panama Papers, which displayed the inner workings of law firm Mossack Fonseca. Instead, focus on the now largest historical leak the world has ever witnessed: The Paradise Papers.
The Paradise Papers leak involves the release of 13.4 million documents. Although the leak is drawing comparisons to last year’s 11 million files leaked in the Panama Papers scandal, the financial entanglement of the latest blown secret runs deeper.
The cache of documents reveals the inner workings of the tax haven industry, built to secure the dollars of the rich, famous, and the world’s most powerful elites. While the average worker struggles to pay their latest child’s medical bill, Appleby, the firm responsible for the latest scandal, established their business in providing zero corporate tax rates for thousands of wealthy clients.
The offshore industry pitched itself as the law firm for respectable wealth, offering their clients offshore entities in tax havens such as the Cayman Islands.
The leak, first obtained by German newspaper Suddeutsche Zeitung, was shared with the International Consortium of Investigative Journalists. Tech giants such as Facebook, Twitter and Apple, and Glencore mining are incriminated, and over 120 politicians, rock stars and corporations have been implicated.
Among public figures, Nicole Kidman and Keith Urban appear in the leak. Details of the still disputed estate, once owned by the late INXS frontman, Michael Hutchence, is now in question. Canadian Prime Minister Justin Trudeau is named, and Queen Elizabeth II’s private portfolios, worth up to £10 million, have now come under scrutiny.
No guilty party is left untouched. BBC boss Tony Hall is also under fire for assisting stars with funnelling payments through offshore companies worth millions, while Formula One world champion Lewis Hamilton is also mentioned for a £3.3 million tax claim back through the Isle of Man, another tax haven mentioned in the leak. United States President Donald Trump’s inner circle has also been implicated in the papers.
How does the Paradise Papers differs from the Panama Papers? The current leak relates mainly to blue-chip clients, not Mexican drug cartels and world leaders. Further, it highlights the need for officials to investigate the inequity of current tax loopholes.
Is tax avoidance illegal? No. Many corporations seek out to lower the tax burden to zero. But evading tax is, and it is high time the lower classes stopped shouldering the financial burdens of those belonging to the super elites, and for these perpetrators to face criminal sentences.