The President of Iceland, Sigmundur David Gunnlaugsson, has resigned following the startling disclosures in the Panama Papers.
In what has been ascribed as the first casualty of the ‘Panama Papers’, Sigmundur David Gunnlaugsson, Iceland’s Prime Minister, has resigned on Tuesday.
As per the leaked papers Gunnlaugsson’s wife owned an offshore company with big claims on Iceland’s banks. This undeclared conflict of interest have infuriated many Icelanders who have hurled bananas and eggs in protest forcing his resignation.
In 2008, the Icelandic bank had collapsed in the global financial crisis which many blame on politicians and regulators for failing to reign in debts.
More than 11.5 million documents have been leaked from Mossack Fonseca, a Panamanian law firm which specializes in setting up offshore companies. The leak have caused a public outrage as it details the transactions of the wealth of the world’s rich and powerful and brings to light their stashed wealth in stark contrast to the severe austerity and hardship faced by most people.
After this leak, France has announced it would put Panama back on the list of countries which do not cooperate in tax matters. The Chief of Staff of Juan Carlos, the President of Panama, has said during a news conference that the government could retaliate against the French move.
He said no company from Panama had been found to have committed any crime. “We are not going to allow Panama to be used as a scapegoat by third parties. Each country (implicated) is responsible,” said Aleman.
He went on to add, that the President had instructed him to get in touch with all countries which have been implicated.
Iceland’s President Gunnlaugsson has quit ahead of a planned vote of no-confidence, a move that would have certainly led to new elections.
The British Prime Minister, David Cameron, has also come under fire from opponents who have accused him of allowing elites to dodge their tax liabilities.
The Labour Party, which is in the opposition has demanded that the government should do something about tax havens which allow “the super-rich elite” to avoid paying taxes.
“There cannot be one set of tax rules for the wealthy elite and another for the rest of us. The unfairness and abuse must stop,” said Jeremy Corbyn, the leader of the Labour Party.
He went on to add that many of these tax havens, such as Cayman Islands, the British Virgin Islands, are essentially British overseas territories. Other islands such as Isle of Man and Jersey are crown dependencies.
As per the leaked documents, more than 50% of the 200,000 companies set up by Mossack Fonseca are registered in the British Virgin Islands, where such details such as who owns the company need not be provided.
Since Cameron had cast himself as a champion in the war against tax evasion, he was particularly put on a spot when the leaks named his late father and members of the ruling Conservative Party as being Mossack Fonseca’s clients.
Cameron has said he does not any share or have offshore funds and neither does his wife or children benefit from such offshore funds.
“I have a salary as prime minister, and I have some savings, which I get some interest from, and I have a house,” said Cameron.
The Chinese Government, which had earlier executed high ranking officials accused of corruption has dismissed the information provided in the leaked reports as “groundless”. As per the reports, the families of President Xi Jinping as well as several other prominent leaders, both former and current have been named and linked to offshore accounts.
Hong Lei, a spokesman for the Chinese Foreign Ministry spokesman said the government would investigate all those whose names have figured in the reports, however the ministry would not comment on “these groundless accusations”.
Significantly, Beijing has limited the local coverage of the Panama Papers with the State media denouncing the media reports of the leak as biased against non-Western leaders.
The tax department from the Hong Kong government though has said it would take “necessary actions” based on any information it received.
Panama has been one of the most secretive of the world’s offshore havens and has refused to sign the global transparency initiative.
Categories: Geopolitics, Strategy, Uncategorized
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