Tax Haven Papers leak reveals secrets behind offshore secrecy

Written by Serna, CNN Global leaders are in attendance at the G20 leaders’ summit in Buenos Aires, where, in an attempt to crack down on illicit financial flows, they are demanding countries crack down…

Tax Haven Papers leak reveals secrets behind offshore secrecy

Written by Serna, CNN

Global leaders are in attendance at the G20 leaders’ summit in Buenos Aires, where, in an attempt to crack down on illicit financial flows, they are demanding countries crack down on off-shore tax havens.

The United States, China, Germany, Japan, United Kingdom, France, Italy, Belgium, Canada, Argentina, Peru, Mexico, Indonesia, Vietnam, South Africa, Russia, Saudi Arabia, United Arab Emirates, Morocco, Turkey, Morocco, Singapore, Peru, Australia, New Zealand, Mexico, India, Mexico, Egypt, Germany, Sweden, South Africa, Belgium, Canada, Argentina, and the European Union are all sending delegations to the summit, where they’ve made their voices heard.

Unfortunately, amid the chaos of a diplomatic summit, two revelations about offshore tax haven secrecy have attracted far more attention than expected.

What are the Pandora Papers?

According to tax watchdog Global Financial Integrity , the countries with the highest offshore tax revenue in 2008 and 2013 were the Netherlands, the US, the Bahamas, Iceland, Barbados, Luxembourg, United Arab Emirates, and the Cayman Islands.

Where did the papers come from?

The documents themselves date back to the 1970s and 1980s, which was a time when the offshore industry was starting to take shape. In 2007, researchers from the International Consortium of Investigative Journalists (ICIJ) discovered a repository of leaked offshore files from a British Virgin Islands firm called Appleby.

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In 2015, a judge in Guernsey ruled that the ICIJ could publish the documents . The group ultimately published, in partnership with the Guardian and the BBC, nearly 150,000 documents that detailed the relationship between the big offshore law firms and their clients’ financial empire.

What are the documents about?

One of the leak’s most curious nuggets was a tax application, called the “Poordraum,” which described a little-known organization which channeled funds from the mining industry and other industries into more conventional subsidiaries to avoid taxes.

Where did the papers end up?

After an initial release, the documents were published around the world, beginning with The Guardian and the BBC in The UK. Since then, 15 media organizations from more than 30 countries have brought the documents to light, and the Guardian has worked with over 70 investigative journalists from 70 different nations, including CNN.

As a result, there have been numerous global investigations , which revealed the hidden offshore world for a wide variety of businesses, from multinationals to states and governments, as well as governments who had used private tax havens to hide money from their own tax collection agencies.

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In recent weeks, French lawmakers launched a deeper probe into alleged tax avoidance from the airline giant Air France . in the UK, British Prime Minister Theresa May was recently exposed in an article in The Times revealing she owned an offshore company. Britain’s Conservative Party — which she leads — is also facing intense pressure to release its tax haven list , which it planned to publish publicly in June, but did not in response to mass criticism from its own members.

Is Canada has taken action?

On Wednesday, Canada’s ministers of finance and justice met with representatives from foreign governments — including representatives from Argentina, Mexico, Argentina, Uruguay, Uruguay, Brazil, Chile, and the European Union — to discuss how foreign governments can help track down tax dodgers and increase transparency in offshore schemes.

While a close ally of the US, Canada has been comparatively low-key when it comes to clamping down on corporate tax avoidance schemes and wealthy tax evaders. When announced in May, Canada’s proposed tax measures were the latest in a series of perceived concessions to the United States, which have included giving up development of a trade deal in Canada’s energy sector, and softening its intention to nationalize the oil tanker business.

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