The Panama Papers’ sobering lessons

World political leaders discuss corruption in the wake of the Panama Papers leak
May 12, 2016: U.S. Secretary of State John Kerry (2-R), British Prime Minister David Cameron (C), Colombian President Jose Manuel Santos Calderon (R) attend the Anti-Corruption Summit organized in London after the Panama Papers leak (source: dpa)
  • A significant group of individuals implicated in the scandal are professional politicians
  • Politicians demonize the rich in order to tax the middle class
  • Tax structures are going to change in the future

When in early April 2016 a consortium of journalists published a list of celebrities, artists, businesspeople and politicians who were connected to offshore companies managed by a law firm in Panama, the so-called Panama Papers scandal broke out. Not all of these companies had been set up to reduce or evade taxes, but the exposure caused considerable embarrassment, including to some heads of state.

The Central American country of Panama has the reputation of a tax haven that steadfastly declines to provide information to tax authorities around the world. The Panama Papers story invites one general observation and raises two important issues.

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