‘British PM, husband have no direct offshore investments’
Document reveals offshore deals with Apple, others
LONDON, Nov 7, (Agencies): Neither the British Prime Minister Theresa May nor her husband have any direct offshore investments, her spokesman said on Monday, after leaked documents revealed investments by wealthy individuals across the globe.
“Neither the prime minister or Mr May have direct offshore investments, their investments have been declared to the cabinet office and are held in a blind trust,” he told reporters. “The nature of a blind trust is just that, this is a well established mechanism in protecting ministers in their handling of interests.”
Meanwhile, new revelations Monday from the “Paradise Papers” shed light on Apple’s tax avoidance strategy which shifted profits from one fiscal haven to another as well as loopholes employed by Nike and Formula One champion Lewis Hamilton.
They are the latest disclosures from a trove of documents released by the US-based International Consortium of Investigative Journalists (ICIJ) concerning secretive offshore deals that have proved deeply embarrassing.
According to documents cited by the New York Times and BBC, the offshore legal services firm Appleby helped the iPhone maker shift tens of billions of dollars from Ireland to the Channel Islands when it appeared to face a tougher stand on taxes by Dublin.
The report said Apple transferred funds to the small island of Jersey, which typically does not tax corporate income and is largely exempt from European Union tax regulations.
Apple did not immediately respond to an AFP query on the report but told the New York Times it follows the law in each country where it operates.
At a 2013 congressional hearing, Apple chief Tim Cook denied the use of “gimmicks” to avoid taxes. The company is now facing an EU demand for about $14.5 billion in taxes based on a ruling that its tax structure in Ireland amounted to illegal state aid.
The BBC and Guardian newspaper reported Hamilton avoided paying taxes on his private jet using an elaborate scheme now under investigation by British tax authorities.
The leaked documents showed the driver received a £3.3 million ($4.4 million, EUR3.7 million) tax refund in 2013 after his luxury plane was imported into the Isle of Man — a low-tax British Crown Dependency.
Representatives for Hamilton could not be reached by AFP for comment.
A separate report appearing in France’s Le Monde said Nike used a loophole in Dutch fiscal law to reduce its tax rate in Europe to just two percent compared with a 25 percent average for European companies.
The tax savings came from Nike’s use of an offshore subsidiary which charged royalties to the company’s European subsidiaries, the report said.
Separately, the documents showed the Russian connection of US Commerce Secretary Wilbur Ross through a complex web of offshore investments.
They revealed Ross’s 31 percent stake in Navigator Holdings partnership with Russian energy giant Sibur, which is partially owned by President Vladimir Putin’s son-in-law Kirill Shamalov and Gennady Timchenko, the Russian president’s friend and business partner who is subject to US sanctions.
The cabinet member’s ties to Russian entities raise questions over potential conflicts of interest, and whether they undermine Washington’s sanctions on Moscow.
The US imposed sanctions on Russian entities and individuals over the annexation of Crimea and the crisis in Ukraine.
The billionaire investor told Bloomberg on Monday he was not intending to hold onto his stake: “I’ve been actually selling it anyway but that isn’t because of this.”
On Monday, Russian politicians played down the leaks, saying the deals mentioned were legal and not politically motivated.
In a statement reported by Russian news agencies, Sibur voiced its “amazement at the politically charged interpretation in some media of ordinary commercial activity.”
There were also reverberations in South America, where the name of Argentina’s Finance Minister Luis Caputo also turned up in the “Paradise Papers.”
Argentina’s La Nacion newspaper reported that Caputo, before his appointment as minister, managed a US-based investment fund with activites in the Cayman Islands and Delaware.
The revelations prompted opposition calls for his resignation.
Earlier reports highlighted offshore holdings of Britain’s Queen Elizabeth II and a top fundraiser for Canada’s prime minister.
The documents showed around £10 million ($13 million, 11 million euros) of the queen’s private money was placed in funds held in the Cayman Islands and Bermuda, as first reported in Britain by the BBC and the Guardian newspaper.
France on Tuesday asked its European partners to agree on curbing international funding of states that provide tax shelters, following the huge leak of documents showing the tax affairs of the rich and famous.
Finance Minister Bruno Le Maire, ahead of a meeting of European Union peers, called for a “credible” blacklist to be drawn up of tax havens and for sanctions for those who do not cooperate.
Talks on a blacklist, initially planned for December, were brought forward by the EU ministers after media reports citing the “Paradise Papers”, a trove of financial reports leaked mostly from Appleby, a prominent offshore law firm.
Though tax avoidance is legal in many circumstances, the papers have dragged in famous names, including Britain’s Queen Elizabeth.
The documents were obtained by Germany’s Sueddeutsche Zeitung newspaper and shared with the International Consortium of Investigative Journalists (ICIJ) and some media outlets. Reuters has not independently verified them.