Paradise Papers Leak Exposes Tax Dodges Used by the Wealthy — Ross Professor
Cindy Schipani, professor of business law, says the leaked files add life to the argument that the super rich don’t pay their fair share.
The Paradise Papers investigation of 13.4 million files leaked from offshore service providers exposed the financial activities of some the richest people in the world, along with corporations. Michigan Ross Professor Cindy Schipani, an expert on corporate governance and business ethics, says the revelations come at an interesting time in the U.S., where Congress is trying to overhaul the tax code:
This disclosure is particularly interesting given the current discussion of tax policy. This exposes how very wealthy individuals and corporations have been able to shield wealth from the U.S. taxing authorities, adding more steam to the argument that it is less wealthy individuals who bear a greater tax burden.
And to the extent the hidden wealth of public officials has been exposed, citizens have grounds to distrust tax policy. Conflicts of interest raise serious questions regarding whose interests are being protected. Furthermore, the links to Russia, in light of the current investigations, also raise alarming red flags.
The leak may not derail the GOP tax reform, but it should give pause to current proposals that impact the middle class — those who are not able to take advantage of the tax havens. Or, it could at least open a discussion about taxing offshore monies in connection with the discussions about an overhaul.
The release of the files also supports calls to mandate the release of tax records by elected officials and high-ranking political appointees so that the public knows if those individuals who have an impact on tax policy are conflicted or self-interested in the debate and resulting tax reform.
Cindy Schipani is the Merwin H. Waterman Collegiate Professor of Business Administration and professor of business law.
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