Earlier, we reported that documents turned over to the International Consortium of Investigative Journalists revealed President Donald Trump’s Secretary of Commerce Wilbur Ross had business ties to Russian President Vladimir Putin’s son-in-law. Those same papers, now called the “Paradise Papers,” are now revealing even more Trump associates with questionable business practices related to tax evasion.
These revelations could not come at a more ironic time, considering Trump and Republicans have been pushing their tax-reform plan that they claim would “cut the middle-class family a break.” However, the news revealed several within his own administration have been employing practices that would allow their own companies to evade taxes. Although the revelations show they’ve evaded taxes legally, it’s still shady as hell.
Tax havens are used to cover up a paper trail and provide anonymity. The ICIJ reported:
‘The promise of tax havens is secrecy – offshore locales create and oversee companies that often are difficult, or impossible, to trace back to their owners. While having an offshore entity is often legal, the built-in secrecy attracts money launderers, drug traffickers, kleptocrats and others who want to operate in the shadows. Offshore companies, often “shells” with no employees or office space, are also used in complex tax-avoidance structures that drain billions from national treasuries.’
First up in the list of Trump lackeys to be mentioned in the documents is Gary Cohn. Cohn is Trump’s chief economic advisor. He’s also had a major hand in the tax-reform plan. With that said, he’s probably the best guy to have for reforming taxes for the wealthy elite considering he’s got a history of offshore financials.
Before joining the Trump administration, Cohn was the president and COO of Goldman Sachs. The ICIJ reported he was also president of 20 companies based in Bermuda that were also “affiliated” with Goldman Sachs. This was between 2002 and 2006. In 2012, those companies were considered inactive by the Bermuda Registrar of Corporations and were removed from their records.
Citizens for Tax Justice reported on the use of offshore tax havens by Goldman Sachs.
‘Goldman Sachs reports having 987 subsidiaries in offshore tax havens, 537 of which are in the Cayman Islands despite not operating a single legitimate office in that country, according to its own website. The group officially holds $28.6 billion offshore.’
Next up on the list of those tied to Trump mentioned in the papers is Secretary of State Rex Tillerson. It’s not surprising he would show up, honestly. Tillerson was the CEO of ExxonMobil for “more than a decade.” That’s major money, which means major avoidance of taxes.
Back in 1997, Tillerson was the director of a company in Bermuda in 1997, Marib Upstream Services Co. While he was also president of Exxon Yemen, he was a member of Marib’s company board for one year. After Marib lost its production deal with Yemen, it still remained in operation in Bermuda.
According to the report from Citizens for Tax Justice, ExxonMobil holds $51 billion in 35 tax haven subsidiaries.
It should be noted that Secretary of Treasury Steve Mnuchin is not specifically listed by name in the Paradise Papers. However, the bank that he was deputy chairman of was mentioned. The Guardian reported:
‘The US Treasury secretary’s former bank financed offshore private jets for wealthy clients, including a billionaire Yemeni businessman whose son is wanted for rape and murder in the UK.
CIT Bank, where Mnuchin was deputy chairman, provided customers with financing structures for personal aircraft priced at tens of millions of dollars, which customers used to legally avoid sales taxes and other charges.’
CIT issued this statement:
‘CIT complies with all laws, regulations and ethical standards in pursuit of its business.’
Yes, even the former presidential candidate and retired neurosurgeon came up in the papers. Specifically, the documents revealed a biotech company that Carson formed had “offshore holding firms.” They were created to hold “intellectual property related to the treatment of cancer and other diseases.”
The Guardian noted what offshore holding firms are used for.
‘Offshore holding firms can be used to lower corporate tax bills for firms that make money from inventions or creative productions. Typically the offshore entity holds the intellectual property, leases it back to the parent company, and collects the royalties or revenues from its use. Tax havens such as Bermuda impose no tax on company profits.’
Featured image by Win McNamee/Getty Images.