ICIJ: Leaked Documents Expose Secret Tax Haven Secrets

The International Consortium of Investigative Journalists released 13.4 million leaked files from a group of offshore service providers that show how companies and individuals thwart government efforts to collect taxes. One of the many stories of the so-called Paradise Papers focuses on Apple, the largest public company by market capitalization. Company officials admitted to US Senate investigators in 2013 how profits were shifted to Irish subsidiaries to reduce taxes. Ireland soon imposed a crackdown. Advisors to Apple sent out questionnaires to find a new haven. “In the end, Apple settled on Jersey, a tiny island in the English Channel that, like many Caribbean havens, charges no tax on corporate profits for most companies,” reports Simon Bowers for ICIJ. “Under this arrangement, the MacBook-maker has continued to enjoy ultra-low tax rates on most of its profits and now holds much of its non-U.S. earnings in a $252 billion mountain of cash offshore.” Such files were released as the United States considers revisions to its tax code, reducing the corporate tax from 35 to 20 percent. But complex regulations combined with intricate corporate structures and secret havens allow many companies to rely on legal manipulations and pay much lower rates. Three nations – the Netherlands, Ireland and Bermuda – have less than 1 percent of the world’s population – but account for 35 percent of all profits of US multinationals. – YaleGlobal