Once more, a leak from a secretive offshore firm has dominated the headlines, revealing more information about the tax affairs of some of the world’s wealthiest and most influential public figures. Like the Panama Papers leak in 2016, the Paradise Papers have disclosed the previously hidden measures employed by individuals and corporations to legally shelter their wealth. The 13.4 million files that comprise the leaks have originated from a reputable offshore law firm, Appleby, which claims to ‘advise clients on legitimate and lawful ways to conduct their business’. This ‘business’ largely involves holding assets in offshore companies or exploiting loopholes and artificial structures so as to avoid paying the full amount of tax.

The leak demonstrates that the offshore empire is bigger than previously thought, even after the Panama Papers revealed a significant amount of global tax avoidance. Some high-profile individuals have been named in the files, including the Queen, who has £10million of her private estate invested in offshore companies despite receiving a sovereign grant of £82million a year from taxpayers. The newly crowned F1 World Champion Lewis Hamilton also benefitted from a controversial Isle of Man scheme that saved £1.1million of VAT on his private jet, despite a reported personal fortune of £130million. Also, global figures such as US Commerce Secretary Wilbur Ross and former White House strategist Steve Bannon are named in the reports, while the arrangements of multinational corporations Nike and Apple (among many others) are under scrutiny.

However, the schemes and trusts that have been used are fundamentally legal, if run correctly. They may be based in offshore tax havens and involve controversial payments and refunds, but they are not outside the law. In that case, why are these activities contentious?  The questions appear to be moral ones, rather than legal. The British public, who were told after the financial crisis in 2008 that ‘we are all in this together’ and have subsequently faced cuts to public services, have again seen high-profile individuals use their wealth to avoid paying their fair share of tax. Is this fair to ordinary individuals who have no reasonable option to utilise such schemes? Tax avoidance measures raise significant ethical questions over the apparently different rules for the rich to those for the majority, magnified by the backdrop of austerity. The Guardian estimates that £12.7bn of UK tax money is lost to offshore tax havens each year.

Despite widespread condemnation by all major UK parties, it is unlikely that offshore schemes will be made illegal in the near future. Without a widespread public call for action, it is unlikely that any action will be taken at all. The resignation of Iceland’s Prime Minister was the only fallout of note from last year’s Panama Papers leak, despite embarrassment for all individuals involved. Efforts to introduce greater transparency, such as a world financial registry, have been pushed back as ‘counter-productive’ and ‘costly’. While the Conservative election manifesto listed a policy of ‘vigorous action against tax avoidance and evasion’, it has clearly not happened yet. International action against tax havens is currently inconceivable. Only committed action by all major parties will solve this issue as it develops further, whether abolishing the tax laws of offshore havens in the UK’s territory or establishing measures aimed at eradicating the secrecy of these schemes.