Panama Papers Leak Update: Apple, Microsoft, Walmart Hiding Trillions In Tax Haven?

Ayush Adhikari

The scandal of Panama papers leak has shed lights on huge account of money laundering from offshore tax havens. It has slowly swept important officials from all around the world. The magnitude of money that is involved in the offshore tax havens is incredible, and if the report from Oxfam is to be believed, U.S. corporations alone have hidden $1.4 trillion cash in offshore tax paradise.

The bold claim of Oxfam is based on the charity's analysis of the financial affairs of the 50 biggest U.S. corporations.

"The sum, larger than the economic output of Russia, South Korea and Spain, is held in an 'opaque and secretive network' of 1,608 subsidiaries based offshore, said Oxfam."
"The use of over 1,600 subsidiaries lowered their global tax rate on $4 trillion of profit to an average of 26.5%, compared to the statutory minimum of 35%, according to Oxfam."
"'The vast sums large companies stash in tax havens should be fighting poverty and rebuilding America's infrastructure, not hidden offshore in Panama, Bahamas, or the Cayman Islands,' Oxfam America president Raymond Offenheiser said in a statement."

Boston-based electric giant General Electric lies safely on second. Oxfam believes that General Electric has received around $119 billion stored in 118 tax haven subsidiaries. Oxfam believes general electric received $28 billion in taxpayer backing.

"Oxfam calculated that $1.4 trillion is being kept in offshore tax havens with the $1 trillion paid in tax by the top 50 US firms between 2008 and 2014."
"According to the Guardian, Overall, the use of tax havens allowed the US firms to reduce their effective tax rate on $4tn of profits from the US headline rate of 35% to an average of 26.5% between 2008 and 2014."

"We can't go on with a situation where the rich and powerful are not paying their fair share of tax, leaving the rest of us to foot the bill. Governments across the globe must come together now to end the era of tax havens," he added.

Tax avoidance by U.S. corporations costs the country some $111 billion a year. The tax dodge is also aiding the global wealth divide by draining $100 billion from the poorest countries, Oxfam estimated.

"Tax dodging practised by corporations and enabled by federal policymakers contributes to dangerous inequality that is undermining our social fabric and hindering economic growth," the report said.

U.S. firms made $80 billion in profit in Bermuda, a safe offshore tax haven like Panama. That is more than their combined reported profits in Japan, China, Germany, and France, four of the world's five largest economies, said Oxfam.

[Photo by Arnulfo Franco/AP Images]