On Sunday evening the Guardian and a series of other media organisations around the world published the first revelations from the Panama Papers – the biggest leak of secret information in history.
The 11m documents come from the files of Mossack Fonseca, the world’s fourth biggest offshore law firm, and help show how the politically powerful and the rich are able to exploit secret offshore tax regimes.
Using offshore companies to save tax has been condemned by many governments and can often be illegal. However, in other cases it can be permitted. Mossack Fonseca says it complies with anti-money-laundering laws and carries out thorough due diligence on all its clients. It has acted “without reproach” for 40 years, it says.
The papers were obtained from an anonymous source by the German newspaper Süddeutsche Zeitung and shared by the International Consortium of Investigative Journalists with other media organisations, including the Guardian and the BBC.
One of the powerful people who use huge and complex offshore tax structures, is Vladimir Putin.
The Panama Papers show $2bn-worth of secret offshore deals and vast loans connected to the Russian president. He is not named in any of the records, but they show how many members of his inner circle have become hugely wealthy.
New Zealand’s prime minister, John Key, has defended his government’s tax record after the Panama Papers showed links to the country, connected to alleged offshore trusts set up by Maltese politicians and officials via New Zealand. Key told reporters:
And in Australia the heat is also being felt by individuals named in the papers. AP reports that more than 800 wealthy Australians under investigation by the Australian Taxation Office for possible tax evasion linked to their alleged dealings with Mossack Fonseca.
The tax office said in a statement it had identified more than 800 individual Australian taxpayers in the data, and linked more than 120 of them to an associate offshore service provider in Hong Kong, which it did not name.
Another politician facing tough questions following the leak is Sigmundur Davíð Gunnlaugsson, Iceland’s prime minister. He is expected to see calls for a snap election after the documents showed offshore investments held by him and his wife, Anna Sigurlaug Pálsdóttir.
There are also more questions for Fifa to answer, connected to questionable business links of a key member of its ethics committee. The files could threaten to undermine the credibility of the ethics committee, which is central to attempts to show Fifa is willing to reform after decades of corruption allegations.
In Britain the reaction to the files has also, thus far, been limited. The head of enforcement and compliance at HM Revenue & Customs, Jennie Grainger, said the organisation was seeking access to the material:
“HMRC can confirm that we have already received a great deal of information on offshore companies, including in Panama, from a wide range of sources, which is currently the subject of intensive investigation.
We have asked the ICIJ to share the leaked data that they have obtained with us. We will closely examine this data and will act on it swiftly and appropriately.
Our message is clear: there are no safe havens for tax evaders and no-one should be in any doubt that the days of hiding money offshore are gone. The dishonest minority, who can most afford it, must pay their legal share of tax, like the honest majority already does”
The shadow chancellor, John McDonnell, called on Sunday night for more to be done by both HMRC and the government.
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