The head of Sweden’s largest business lobby resigned Wednesday after comments he made amid Paradise Papers revelations about his offshore holdings.
Leif Östling, chairman of the Confederation of Swedish Enterprise and the former head of the truckmaker Scania, and his wife owned a Maltese company called Hertsoe Ltd. that held about $3.6 million worth of stock via subsidiaries in Luxembourg, ICIJ partner SVT (Swedish public television) reported two weeks ago.
You ask yourself, if you pay 20 to 30 million kronor a year, ‘What the hell do I get for my money?’
“It’s a problem with the Swedish tax system: the taxes are insanely high in this country,” he told SVT, adding that he had paid as much as a thousand ordinary taxpayers had. “You ask yourself, if you pay 20 to 30 million kronor a year, ‘What the hell do I get for my money?’ It is not much.”
Östling said the arrangement was legal and that he had always paid the taxes he owed, but his comments triggered a backlash in the famously high-tax, high-benefits country, where the concept known as the Law of Jante frowns on individuals who focus on themselves at the expense of society.
While Malta is in the European Union, its 5 percent corporate tax rate for international companies is well below those of other European countries. The companies created there highlight the fact that the offshore system isn’t limited to tropical locales like Panama or the Cayman Islands but includes “onshore” locations like Luxembourg and Malta.
“Sweden’s entrepreneurs must be able to argue for a better business environment, of which taxes are an important part, without being affected by possible debates about me,” Östling said in a statement announcing his resignation.
Östling is the first major public figure to resign in the wake of the Paradise Papers.