International Consortium of Investigative Journalists

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Seven times tax evasion made headlines in 2015

HSBC

From tax cheats to heated policy debates, 2015 has been a year of big headlines for tax scandals. In February, ICIJ’s Swiss Leaks investigation revealed that the Geneva branch of HSBC, holding over $100 billion in its bank accounts, welcomed tax dodgers and criminals as clients.

Here is a review of some other headline-grabbing news from the world of tax evasion in 2015:

1- Panama and the Cook Islands agree to automatic exchange of financial account information (November)

During an OECD-organized Global Forum on Transparency in Barbados, three new countries committed to implementing automatic exchange of information in 2018: Panama, one of the most opaque financial center in the world, Cook Islands and Ghana. Under this principle, those countries agree to collect information on bank accounts held by foreigners, and give that information to other national authorities, on a yearly basis. Until now, this information could only be provided on a case-by-case basis.

Those countries now need to introduce domestic legislation so that the measure comes into effect. Nearly 100 jurisdictions have joined this worldwide fiscal cooperation.

2- Switzerland signs a historic transparency agreement with the European Union (May)

A historic agreement between Switzerland and the EU attempted to end banking secrecy for EU citizens using Swiss banks accounts. It was one of a number of information-sharing agreements the traditionally secretive jurisdiction signed with countries around the world.

“[This] agreement heralds a new era of tax transparency and cooperation between the EU and Switzerland,” said EU tax commissioner Pierre Moscovici in a statement in May.

In December the Swiss parliament approved reforms allowing the automatic exchange of tax information with select countries, heralding the beginning of the end of Swiss banking secrecy for foreign clients according to news outlet SwissInfo.ch.

The country will start automatically sharing tax information in 2018.

3- Greek government hands data on suspected tax cheats to prosecutor (December)

Greek Prime Minister Alexis Tsipras announced his government had handed a USB stick with data of potential tax fraudsters to a prosecutor, after meeting with HSCB whistleblower Hervé Falciani. Falciani was sentenced by Swiss courts to five years in prison for aggravated industrial espionage in November.

According to Reuters, a court official said the new data could help investigate the Greek side of the Swiss Leaks data, also known as the “Lagarde List.”

4- Brazilian soccer player Neymar alleged to have evaded $16m in tax (September)

FC Barcelona’s NeymarA São Paulo federal court accused 23-year-old Barcelona star Neymar of evading $16 million in taxes (about 63 million Brazilian reals) between 2011 and 2013 by not declaring “income from abroad.” The cited source of undeclared money was the Barcelona Football Club, which Neymar joined in 2013 after leaving Brazilian club Santos.

Judge Carlos Muta froze $49 million (188.8 million reals) of Neymar’s assets in order to cover future interest and fines.

Other celebrities linked to alleged tax scandals this year include:

  • Supermodel Bar Refaeli was questioned by Israeli police in December over her tax affairs;
  • Spanish opera singer Montserrat Caballé, 82, was sentenced to six months in prison for withholding $550,000 (€500,000) in tax;
  • Argentinian soccer player Lionel Messi is under investigation for allegedly having avoided $5.5 million in tax;
  • Heiress of French fashion designer Nina Ricci, Arlette Ricci, was sentenced to a $1.1 million fine (€1 million) for tax fraud.

5- EU forces countries to share information on corporate tax deals (October)

European finance ministers agreed to new rules that will force countries to share information on tax deals granted to multinational corporations. The move was one of a number of EU responses to ICIJ's Luxembourg Leaks investigation, which in late 2014 revealed widespread tax avoidance by hundreds of multinational companies using secret tax agreements with low-tax jurisdictions like Luxembourg.

“This is a decisive step towards greater transparency in tax matters,” said Pierre Gramegna, Luxembourg’s finance minister and president of the Economic and Financial Affairs Council, of the new information-sharing agreement.

6- First report published by the Australian Taxation Office shows one third of the biggest corporations paid no tax (December)

More than a third of the biggest corporations in Australia paid no tax in 2013-2014, the most recent fiscal year on record. This was revealed by the first report published by the Australian Taxation Office.

The ATO’s analysis showed that the energy sector had the highest proportion (60 percent) of companies paying no tax in Australia. Qantas Airways, one of the biggest airlines in Australia, was the company with the highest total income that paid zero taxes.

7- French parliament abandons mandatory public reporting for companies (December)

A measure fighting tax evasion was blocked in the French Parliament after alleged pressure from the Socialist government.

The measure would have made mandatory for companies to make public the number of employees, profits, revenues and taxes paid in each country where they have a subsidiary.

It was abandoned in a midnight session after a 40-minute suspension, which NGOs said was used by the government to maneuver and pressure some left-wing MPs to change their vote. 

The French government said it was not against collecting the information but did not support making it accessible to the public, as it would go against the interests of French companies. 

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