From Iceland — Ex-PM Casts Aspersions On Panama Papers

Ex-PM Casts Aspersions On Panama Papers

Published July 28, 2016

Andie Sophia Fontaine
Photo by
Art Bicnick

Former Prime Minister Sigmundur Davíð Gunnlaugsson has questioned the veracity of the Panama Papers which led to his resignation.

RÚV reports that Sigmundur gave his first extensive interview since dropping virtually out of sight some weeks ago, which he granted again to radio station Útvarp Saga.

Towards the interview’s conclusion, host Arnþrúður Karlsdóttir asked Sigmundur “who was behind the attack against you four months ago,” referring to the Panama Papers leak which implicated him and several other Icelandic politicians, precipitating his resignation.

“I have a pretty good idea, but I think that deserves an entire episode,” he responded. “We can go over that when we get a chance. But there are a lot of interesting things that have come forth regarding this campaign, which was seven months in the making in several countries, to use these documents that [tycoon George] Soros had bought and obviously used at will.”

Sigmundur then began to question the veracity of the documents themselves, without leveling anything specific against them.

“I just want to point out one interesting fact,” he said. “There weren’t a lot of Americans [in the Panama Papers] and not many, or probably no hedge fund managers who probably have a weekly salary comparable to what my wife received in a family inheritance. So it’s obvious that it was decided ahead of time who would be singled out. It doesn’t matter what comes to light in the meantime; what proves wrong and right.”

Sigmundur added that the entire leak was politically motivated, and on the domestic front, was used as a political weapon against him personally.

In fact, contrary to Sigmundur’s contentions, several hedge fund managers have been implicated in the Panama Papers scandal – including Soros himself. In addition, Sigmundur’s own documentation shows he and his wife at the very least misreported what holdings they have to tax authorities.

In a post he made on his personal site, Sigmundur made public a great deal of information about his tax reporting to Icelandic authorities. One of the stand-out contentions of his blog post is the following:

“The tax returns were based on the fact that the main operations of Wintris Inc. did not involve commercial operations but stockholding, bank management, and income from stocks. For this reason, a so-called CFC return was not submitted, as they are intended for holdings in commercial businesses in low-tax states.”

However, Kvennablaðið reports that these contentions do not hold up to scrutiny where Icelandic tax laws are concerned.

Being granted an exception from submitting a CFC return if the business in question is not commercial cannot be found in Icelandic law. Sigmundur has previously contended that CFC laws in Iceland only apply to management companies, and that Wintris was a holding company and therefore exempt from them, but it has been pointed out that this is also not true.

Furthermore, the Directorate of Internal Revenue (RSK) provides CFC returns, and no exceptions are listed regarding whether a person’s offshore company is a management company or holding company. A tax expert who spoke with Kvenneablaðið also confirmed that no exceptions of the kind Sigmundur is talking about can be found in Icelandic law.

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