Operating through so-called ‘offshore’ companies in tax havens is not necessarily illegal … unless the network is hidden from the Spanish Hacienda, with the consequent benefits in taxation. Now, a new massive leak of documents – the ‘Pandora Papers’ – has uncovered the opaque operations of thousands of people around the world. In the case of our country, the journalistic investigation led by the International Consortium of Investigative Journalists (ICIJ) brings to light that this type of business is dotted with 600 Spaniards; several of them, renowned.
Filtration consists of 11.9 million financial documents with branches all over the globe and belonging to 14 law firms specialized in operations in tax havens. In general terms, the investigation reveals a habitual use of trusts, interposed companies and opaque commercial files in jurisdictions with little or no taxation that are kept in the strictest secrecy.
In the case of Spain, two names stand out for the moment: Pep Guardiola and Julio Iglesias. Two recognized figures not only in our country but especially outside our borders, the first for his past and present footballing and the second for his musical career.
Guardiola, former player and former coach of FC Barcelona, had an account in Andorra until 2012. As published by ‘El País’ and ‘La Sexta’ (the two Spanish media that have participated in the investigation of the leak), andThe current Manchester City coach had not declared the funds in said account to the Treasury.
Thus, he was the owner of the same until 2012 since then he accepted the fiscal amnesty of Cristóbal Montoro, under the Government of the PP. He regularized his situation by surfacing almost half a million euros, paying 10% on the interest that his funds had generated in the previous four years and that were not prescribed. Years later, the Constitutional Court overturned this tax amnesty, but without affecting those who previously took refuge. In other words, the regularizations carried out until it was annulled by the Constitution, June 2017, remain fully valid.
Julio Iglesias, another of the Spaniards mentioned in the ‘Pandora Papers’, is pointed out as the beneficiary of 20 ‘offshore’ companies in different jurisdictions, with which he operated. In 16 of them, according to the aforementioned media, he is the owner with his wife, the Dutch Miranda rijnsburger, and in other 4 it is solo. The point of union of all these companies is a trust through which assets are controlled abroad. It was created in 1995 in the British Virgin Islands to manage its assets “for succession purposes”, as stated in ‘El País’.
Beyond this, the singer has no longer had a tax residence in Spain for decades, given his international career.
This leak also reveals the opaque businesses of 35 heads or former heads of state, of which 14 are in Latin America. In total, 330 senior officials and politicians from more than 90 countries. According to the ICIJ, five Spanish politicians appear in the investigation.
Among the most striking names are those of former UK Prime Minister Tony Blair (as well as his wife); singer Shakira (which has dragged problems with the Spanish Treasury for years precisely because of its taxation); the Brazilian Minister of Economy, Paulo Guedes; former IMF managing director Dominique Strauss-Kahn; or King Abdullah II of Jordan.
Striking are also the name of the Prime Minister of the Czech Republic, Andrej Babis, which maintained a structure to pay 20 million dollars (17.2 million euros) for a villa in a French town near Cannes. Although South America is one of the regions where the greatest use of opaque networks has been detected to operate. Even among several presidents or former presidents of several countries in that region.
In South America, the names of three active heads of state stand out. They are the Chilean Sebastian Piñera, the Ecuadorian Guillermo Lasso and the dominican Luis Abinader. The first of them is one of the most notable cases, with a document signed in Chile for 14 million dollars and another in the Virgin Islands for 138 million dollars for the sale of a business and whose total payment would have been linked to the sense of a decision that Piñera himself would have had to adopt, according to ‘El País’.
There are also 11 former leaders, such as the Colombians César Gaviria and Andrés Pastrana, or the Peruvian Pedro Pablo Kuczynski.