The Paradise Papers leak prompted yet more indignation about corporate tax avoidance, and cash-strapped governments claim to be tackling the issue. What will it mean for corporates?
The financial crisis—with the subsequent austerity imposed on citizens—was a turning point in public attitudes. Once upon a time, ordinary citizens might have joked about so-called tax havens. Then governments became strapped for cash, allegations of abuse surfaced through leaks such as the Panama Papers, and people started to feel ripped off. A steady drip of reports about corporate giants’ contortions to reduce taxes (relative to revenues) fueled public anger further.
Tax evasion—denoting illegal strategies—is negligible these days, at least among major multinationals, say tax advisors. As a general rule, multinationals (especially those listed on major stock exchanges) seek to operate within the mainstream of tax planning, explains Sanjay Mehta, tax partner at law
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