In the end of last week the US-based International Consortium of Investigative Journalists (ICIJ), which released Panama Papers last year, made public the Paradise Papers, a leak containing over 13 million documents being sifted through by journalists in more than 67 countries. In particular, the papers revealed information about top companies and dignitaries in the UK who avoided taxes using offshore tax havens. The new information on tax avoidance was discussed by EU finance ministers during the regular talks in Brussels, and some officials urge EU member states to rapidly take measures, among them adopting a European tax haven blacklist.
Similar to the Panama Papers, the Paradise Papers show the secret ways how multinational companies and rich individuals cut taxes by shifting their profits offshore, with the help of accountancy firms. There was also LuxLeaks scandal which revealed in 2014 that Luxembourg, with European Commission President Jean-Claude Juncker as prime minister, gave companies huge tax breaks. In all these cases, billions of profit were legally diverted from taxation, using such offshore jurisdictions as the British Virgin Islands, especially known from Panama Papers leak.
As a result of these scandals, the EU ministers are due to make an official list of unwanted tax havens in December 2017, whittling down an initial list of 92 countries finalised last year. About 60 countries have been warned by EU that their tax policies may be problematic, and asked to provide further information before 18 November deadline.