November 16, 2017

Trouble in Paradis Fiscal

editor:	Shira Jeczmien

Our political milieu is going through a reality crisis, there’s no arguing about it. I often find myself inundated with news that only after brief research are revealed to be ‘fake news’, yet the falsified stories managed to grab my attention none the less. Sieving through information that is in continuous flux between reality and the unreal, how are we to approach news that are fact but too ethereal to comprehend?

The comfortably Westernised democratic education through which most of us living in the global North have emerged, does not equip its pupils with the correct tools – or even school of thought – to fathom scandals such as the Paradise papers, for example. In fact, if economics didn’t lure you with its cash heavy salaries or numerical charms; if you are like myself, understanding the ins and outs of tax evasion, money laundering and offshore accounts can be likened to understanding how skyscrapers are built: quite frankly, it’s beyond me.

Perhaps that’s why such global scale leaks, involving our favourite celebrities, multinationals, the Royal Family and some of the most loathed politicians seems to have made a big explosion, but without the loud bang, shudder and shrapnel as expected.

Because the Paradise Papers, named after the geographical location (as well as tax havens) where the offshore companies are based – also ironically deviating from the French term for tax havens Paradis Fiscal – should really be on everyone’s agenda. With just over a year after the Panama Papers were leaked, the Paradise revelation includes 13.4 million documents leaked that reveal offshore tax evasion that includes: Nike, Apple, the Queen, Lord Ashford, cabinet members of the Trump administration (not a huge surprise here), Justin Trudeau’s chief advisor (are you as devastated about Justin as I am?), among thousands of others. Most of the leaked documents come from the offshore legal service provider Appleby and corporate services provider Estera.

The leaks have reignited investigations into the economy of offshore accounts, currently estimated to be $10 trillion. What was initially exposed by the German newspaper the Süddeutsche Zeitung has been released into the International Consortium of Investigative Journalists (ICIJ) to be taken up by The Guardian, BBC Panorama among about 100 other media platforms.

To quote author and sociologist Andrew Sayer “we cannot afford the rich”, with that there is no arguing either. Tax avoidance robs governments of essential funds for the building of infrastructure, maintaining healthcare and paying for education. The persistent leaks of private documents – although breaching privacy laws of many who have not broken the law – also shine a light on shadowy activities that undermine the rule of law and the norms of public responsibility. As long as offshore accounts continue to be second nature to the world’s elite, so will house prices continue to burst at the seams in metropolitan cities across the world. And the longer secret tax benefits continue to flourish so will the deprivation of the most vulnerable and the urgent poverty will simply continue to prevail.

Picture: Countries with politicians, public officials, or close associates named in the leak