Just read about the Panama papers very briefly and can’t really get a full grip of what it is, just the gist…
In: Economics
To enable international trade, there must be taxation laws that allows money to flow from one country to another without taxation.
Now, imagine that you would want to use this basic idea to entirely avoid paying taxes.
What do you need then? You need a flow of money that is difficult to oversee. You need someone who helps you move money to and from countries where it’s difficult – if not impossible – to ask a bank who the money belongs to.
Panama is a country where it’s somewhat difficult to look into where money comes from and where it goes.
A law firm in Panama has specialised in tax evasion setups (entirely legal, based on the basic idea of free flow of money. Often illegal or at least immoral in your country of residence to make use of this kind of services) and they have been doing it A LOT.
Someone in their staff with access to legal and financial documents (electronic documents, I assume) blew the whistle on them and gave a really large set of documents to an international corporative organisation for reporters.
The reporters, from several different countries, looked into the documents FOR MONTHS. And then, on the very same day, they all released information about their rich celebrities, royalties, politicians (including some prime ministers) and some organisations that are trying to play the poverty- and/or moral-card all the time. Internationally. Globally.
The result, except the bit where a lot of national tax authorities now have proof of tax evasion and sometimes tax fraud, was that a whole lot of people were publicly shamed. Some politicians resigned. Some complies have tossed out their CEO’s and some celebrities are now left without their contracts. And so on.
Pretty interesting few days, that was.
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