Global governments called on to tighten up tax avoidance laws

6 Nov 17

World leaders have come under pressure to address tax avoidance as leaked documents revealed global official figures and businesses have invested their wealth offshore.  

The leak of financial documents, dubbed Paradise Papers, exposed extensive global tax abuses by wealthy individuals and corporations, including offshore dealings of the US president’s cabinet members, advisers and donors. 

A tax avoiding Cayman Islands trust managed by the Canadian prime minister’s chief moneyman was also listed in the documents. 

Campaigning groups Jubilee USA and Transparency International have called for stronger international laws and for governments to introduce stricture measures to prevent corrupt tax avoidance. 

Eric LeCompte, executive director of Jubilee USA, said: “Over $‎500bn a year is lost by governments around the world because of the tax avoidance revealed in the Paradise Papers.

“Unfortunately, many of these tax avoidance ‎schemes are legal and we need stronger international laws to prevent this activity.”

Delia Ferreira, chair of Transparency International, said: “Too many people are finding ways to hide wealth. 

“If that wealth is from the proceeds of corruption it means criminals are being given the means to live off ill-gotten gains.” 

Both US president Donald Trump and UK prime minister Theresa May have previously pledged to address the issue of tax avoidance schemes.

The following the revelation businesses and individuals, including the Queen’s private money, had been invested offshore. 

The papers revealed Trump’s commerce secretary had business links to Russian figures who are under US sanctions, and retained an interest in a company shipping oil and gas for a Russian energy firm.

Canada’s prime minister Justin Trudeau, who has campaigned against tax havens, has also been put under pressure as his key aide and chief fundraiser, Stephan Bronfman, has been linked to offshore schemes that may have cost the country millions of dollars in taxes.

Transparency International said governments should make changes to rules, such as keeping public registers of the real owners of companies, as well as registers containing information on all parties to trust,

The details stem from the leak of 13.4m files, mostly from law firm Appleby, which offers services to set up offshore, including advice that ed legally reduce tax bills.

The documents revealed financial dealings of politicians, celebrities, corporate and business leaders in 19 tax jurisdictions.

The firm said “there is no evidence of wrongdoing” and that the firm “advises clients on legitimate and lawful ways to conduct their business”.

It said: “We do not tolerate illegal behaviour.”

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