In October 2021, the Pandora Papers, published by the International Consortium of Investigative Journalists (ICIJ), revealed in detail the secret financial dealings of some of the world’s elite individuals. The Papers implicated individuals and companies from countries such as Cambodia, India, Malaysia, Pakistan, the Philippines, Qatar, South Korea, and the United Arab Emirates. Also included were individuals and former or current public officials from Russia, Switzerland, Ukraine, and the United Kingdom. Completing the list is a former official of the International Monetary Fund, and an official of Legionaries of Christ, a Catholic religious order.
The Pandora Papers revealed the deep-seated corruption and hidden wealth of the global elite and shed light on one of the major drivers of the vast inequalities that plague modern society – wealth hoarding and profit shifting by wealthy individuals enabled by flawed tax systems and the existence of tax havens.
What happened in the three years since? Numerous government probes, police raids, and even formal court charges took place, spanning Europe,America, the Middle East and Southeast Asia. A new set of ethical standards for tax professionals were introduced by the International Ethics Standards Board for Accountants (IESBA), an independent global standard-setting board. The new standards aimed to rebuild public and institutional trust in the profession that had been shaken during the aftermath of the Pandora Papers and other headline news of global tax scandals over the years. According to the organization, the new guidelines offer a clear ethical framework for all professional accountants, particularly concerning tax avoidance and the role played by consultants.
Although not a direct consequence of the Pandora Papers, a historic milestone was reached in advancing international tax cooperation to address the issue of tax havens and end the scourge of global tax dodging. In August 2024, after months of inter-governmental deliberations, the Ad Hoc committee set up by the United Nations completed and approved the Final Draft of a Terms of Reference (ToR) for a United Nations Framework Convention on International Tax Cooperation.
Meanwhile, peoples’ movements, civil society organizations continued to call attention to flawed tax systems that enabled systematic tax avoidance and evasion by wealthy elites and corporations, and to the enormity of ill-gotten or untaxed wealth that have robbed public coffers for years. Clearly there is a link between these issues and the unabated rise in inequalities and the decline in public financing of essential services and urgent measures needed to address the climate crises. “Tax the Rich, Not the Poor,” a slogan that gained popularity among peoples’ movements during the pandemic, has advanced to more concrete demands for wealth taxation. In October this year, an Asian Peoples’ Petition for Wealth Tax and Urgent Climate Action began to draw support from hundreds of individual signatories – the aim is to enlist at least one million signatures across Asia to demonstrate the popular clamor for wealth tax and pressure governments to fix the flaws and biases of tax systems. The initiative is led by the Asian Peoples’ Movement on Debt and Development together with its members and partners in Bangladesh, India, Indonesia, Malaysia, Nepal, Pakistan, Philippines, and other countries.
Like in the Pandora’s Box in Greek Mythology where Hope was the last to emerge, there remains a good measure of optimism that a sustained effort and advocacy to end the scourge of global tax abuse and wealth hoarding, could still right these wrongs. Winning the battle to end global tax abuse plays a vital role in the fight against inequalities and the war against hunger.
Inequality and the Costs of Wealth Hoarding by the World’s Elites
While close to a billion people or around eight percent of the world’s population live on less than US$2.15 a day, the extreme poverty line, a few hundred politicians, business executives, royalties, celebrities, religious leaders, and even drug dealers, continue to live lavishly on wealth stashed-away in faraway offshore accounts.
Some of this wealth may have legitimate origins but was eventually hidden to evade or avoid tax obligations; some was stolen from public funds or obtained through political bribes, while others are the proceeds of outright criminal activities like gun and drug trafficking.
According to a 2023 study by Daniel Reck of the London School of Economics, along with colleagues from Carnegie Mellon University and the University of California, titled “Tax Evasion at the Top of the Income Distribution: Theory and Evidence” (NBER), tax evasion schemes by the super elite have become so sophisticated that even expert auditors struggle to locate offshore accounts. The study notes that if tax evasion by the wealthy were accurately accounted for, the inequality gap between the very rich and the rest of humanity would be even more pronounced.
Hiding wealth to acquire more wealth
The illicit financial dealings tackled in the Pandora Papers were estimated to range from US$5.6 to US$32 trillion composed of cash, high-valued assets like lavish houses, and even works of art. All of the transactions were done through shell companies and trusts in tax havens like the Cayman Islands, Malta, the Bahamas, British Virgin Islands, and even countries such as Singapore, Mauritius, and Luxembourg.
TPrior to this, the ICIJ had released the Panama Papers1 in 2016, with 11.5 million confidential documents. A year later in 2017, it also leaked the Paradise Papers, which outed the likes of AIG (US-based leading global insurance company), Prince Charles, Queen Elizabeth II, the president of Colombia Juan Manuel Santos, and U.S. Secretary of Commerce Wilbur Ross.
Public outcry ensued as well as calls for greater transparency and reform. These highlighted the failure of governments to address offshore financial abuses effectively, which is linked to the widening gap between the number of rich people and those living in poverty. Since then, further investigations and leaks have continued to uncover new names and details, keeping the issue in the public eye.
The 2024 global wealth report by the Union Bank of Switzerland (UBS) says that the top of the world’s wealth pyramid is composed of just 14 individuals who own around U$D 2,000 billion. The second tier is populated by 12 individuals with wealth between U$D 50 and 100 billion, while over 2,600 people have wealth between U$D 1 and 50 billion. In its 2022 global wealth report, the Swiss bank valued global wealth at US$ 463.6 trillion, and estimated that about 2.8 billion people, or 53 percent of the world’s adult population own wealth below US$ 10,000.
Asia In the Aftermath of the Pandora Papers
When the Pandora Papers exploded in the media in 2021, it opened a can of worms – corruption and hidden wealth by some of Asia’s political and economic elites. While these phenomena are considered ‘open secrets’ in the region, the years of research by investigative journalists – for some, amid threats against their life – bore fruit and evidence that had long eluded the public.
India
India’s Enforcement Directorate, a law enforcement and economic intelligence agency, is actively investigating high-profile figures with offshore accounts, including a real estate tycoon, a royal family member, and a government official’s heir.
Lalit Goyal, co-founder of the real estate group IREO, transferred assets worth approximately US$77 million to accounts in the British Virgin Islands (BVI) before his company suffered significant losses due to fund misappropriation. He was arrested in November 2021 for money laundering but was eventually released on bail. Currently, he remains under investigation in connection with documents from the Pandora Papers.
The former Maharaja of Jodhpur and Member of Parliament, Gaj Singh, was also found to have ties to a BVI entity named Atalante Perennity Inc., which was liquidated in 2018. He was summoned by the Enforcement Directorate in 2023, and investigation is ongoing.
Bakul Nath, son of Indian National Congress leader Kamal Nath, was found to be connected with an offshore company named Spector Consultancy Services, based in Dubai.
As many as 380 Indian nationals were implicated in the Pandora Papers, and many of them are not only business figures but also close relatives of government officials. Shortly after the Papers’ publication in 2021, the Indian government set up a multi-agency group, comprising officials from the central bank and tax agency, to investigate the individuals involved.
Pakistan
Pakistan was also included in the 2021 Pandora Papers exposé, which implicated over 700 individuals, including ministers and members of then-Prime Minister Imran Khan’s inner circle. In addition to politicians, army generals and bureaucrats were linked to companies and trust holdings in tax havens, though the documents do not show any accounts directly tied to Khan. The list also includes former senator and finance minister Shaukat Tarin. A long-time banker, Tarin explained that he established the offshore company to raise funds for CitiBank.
In 2018, Khan was elected to office, leveraging his long-standing reputation as a cricket legend and capitalizing on the political turmoil sparked by the Panama Papers in 2016. These documents revealed that the children of Pakistan’s prime minister at that time owned several luxury apartments in London.
Khan was arrested in 2023 on corruption charges after being removed from office by a no-confidence vote in early 2022. In July 2024, he was acquitted of charges related to the sale of expensive state gifts but remained imprisoned due to other charges, despite retaining significant popularity. Meanwhile, Tarin eventually resigned from his elected position and announced that he would leave politics entirely in December 2023.
Malaysia
In Malaysia, the Pandora Papers implicated several business figures and politicians, including former Deputy Finance Minister Yamani Hafez Musa, former Finance Ministers Daim Zainuddin and Tengku Zafrul Abdul Aziz, and UMNO President Ahmad Zahid Hamidi. Also named were the parents of the infamous businessman-financier Low Taek Jho, commonly known as Jho Low.
In January 2024, Daim Zainuddin, a key ally and former aide to ex-Prime Minister Mahathir Mohamad, faced corruption charges following an investigation by the Malaysian Anti-Corruption Commission (MACC). The charges stemmed from the 2021 Pandora Papers, which revealed Zainuddin’s offshore accounts, estimated to hold at least $31 million. Further investigation uncovered that, as recently as 2020, the former minister’s youngest sons and wife were also beneficiaries of a trust holding assets valued at US$52.5 million.
In April 2024, Mahathir Mohamad, a two-time prime minister and a long-standing figure in Malaysian politics, became the subject of a graft investigation by the Malaysian Anti-Corruption Commission following the earlier mention of his two eldest sons in the Pandora Papers.
Thailand
In Thailand, Chitpas Kridakorn, a member of parliament and heiress to the Singha beer empire, was identified as a possible beneficiary of a trust that owned properties in the UK. Following the publication of the Pandora Papers in 2021, she was investigated by the country’s anti-corruption commission.
Sri Lanka
In Sri Lanka, the 2021 Pandora Papers also identified former Deputy Minister Nirupama Rajapaksa and her husband as holding offshore companies and trusts that control approximately US$18 million worth of properties. She is a relative of Gotabaya Rajapaksa, the country’s eighth president and a former military officer who was forced to resign in 2022 following widespread public protests over an economic crisis.
Ramalingam Paskaralingam, a bureaucrat and former adviser to three previous top Sri Lankan officials, was found to own offshore companies and trusts with assets amounting to unspecified millions of dollars.
According to the latest data, 733 million people go hungry everyday which increased by 152 million from 2019. In addition, according to the Tax Justice Network, global tax evasion costs governments approximately $427 billion annually in lost revenue. The Pandora Papers only revealed the lengths to which the elites and the world’s wealthiest will go just to increase their wealth exponentially and hide it from the public’s eye, to avoid scrutiny and paying taxes. The enormous untaxed or unexplained wealth represents money that should have gone to the public coffers, to be used to finance public services and social programs to address hunger and inequality.
Political Dynasties, Unfair Labor Practices, and Hidden Wealth: The Philippines’ Case
The Pandora Papers implicated over 940 individuals and companies linked to the Philippines. Reports from the Philippine Center for Investigative Journalism and local media highlighted these revelations, involving families with significant business and political influence.
Among them are the Aboitiz family, with diverse interests in sectors such as banking, real estate, and power generation, and the Sy siblings, owners of the SM Group, who were ranked by Forbes in 2021 as the wealthiest Filipinos, with a combined fortune of $16.6 billion. The SM Group is also known for keeping a significant portion of its workforce under contractual status, restricting their ability to unionize and negotiate better wages.
The investigative report also highlighted members of the Gatchalian family in connection with nine offshore companies. Senator Sherwin Gatchalian is a prominent figure from this family, as is Arthur Tugade, former Transportation Secretary under the Duterte administration. Records indicate that Tugade and his children are linked to Solart Holdings Limited, a company registered in the British Virgin Islands. Both Gatchalian and Tugade hold significant business interests.
An intriguing figure in the Pandora Papers is Rolando Gapud, who once served as a financial adviser to the Marcos family. He was instrumental in identifying some of the family’s hidden assets, which the government eventually managed to recover. Estimates of the wealth illicitly accumulated by the Marcos family range from US$5 billion to US$13 billion, with some experts suggesting even higher figures due to the protracted period of theft. In 2003, the Philippine Supreme Court ruled that approximately ₱25 billion in assets were illegally acquired by the Marcoses. Despite nearly four decades of legal disputes, a significant portion of this wealth remains unrecovered, a situation further complicated by the current presidency of Ferdinand Marcos Jr., an heir to the estate.
In 2013, the ICIJ reported that Imee Marcos, the eldest child of the late dictator and now a senator, was a beneficiary of the Sintra Trust, established in 2002 in the British Virgin Islands. Documents link her to financial dealings involving Sintra Trust and ComCentre Corporation, a company in which Sintra Trust held a stake, as well as to an account at United Overseas Bank in Singapore.
Former Senator Manuel Villar, ranked as the third wealthiest Filipino in 2024 with a net worth of US$10.9 billion according to Forbes, was also reported by the PCIJ to have maintained offshore accounts. Villar owns extensive commercial properties, and both his wife and son are current members of the Philippine Senate.
Unfortunately, the revelations of the Pandora Papers have yet to make a significant impact on policy reform or other government actions in the Philippines. With Ferdinand Marcos Jr., the son of the late dictator, now serving as president, any legal attempts to further recover portions of the Marcos family’s wealth are likely to be swiftly dismissed.
The Philippines continues to rank high on the government corruption index, gripped under the reign of political dynasties and elite capture of the legislature. Public officials appear to be unresponsive to calls for accountability or immune from legal repercussion. Investigating potential tax evasions by the high-profile individuals mentioned in the Papers will require tremendous political will on the part of the government, and strong push and pressure from civil society. Ensuring financial transparency, accountability, and integrity among public officials remains a pressing and critical issue for advocacy.
Towards a more equitable global tax regime
Addressing the global scourge of wealth hoarding and tax dodging requires thoroughgoing reforms in national and global tax systems. In 2020, the United Nations (UN) established the High-Level Panel on International Financial Accountability, Transparency, and Integrity (FACTI Panel) to support member countries in implementing the goals of the 2030 Agenda for Sustainable Development. Among its key recommendations were to overhaul the global financial system, introduce a new UN tax convention, establish a UN tax body, and implement a universal minimum tax.
As tax havens allow corporations and wealthy individuals to evade or aggressively avoid paying equitable taxes, thereby perpetuating global inequality, a new tax convention should aim to decisively address this issue. First, it would enforce transparency measures that require countries to share financial information, reducing the secrecy provided by tax havens. Second, it would unify the global tax framework closing loopholes that the wealthy exploit by moving assets across jurisdictions with different tax laws. Third, it would hold both countries and individuals accountable, making it more difficult for the wealthy to evade taxes without consequences. Lastly, the convention would ensure that taxes are collected where economic activities take place, preventing profits from being shifted to low or no-tax jurisdictions. A UN Tax Convention serves as both a product of and framework for inclusive global democratic tax governance and international tax cooperation under the auspices of the United Nations where each country negotiates on equal footing.
Until recently, wealth and corporate taxes have been a contentious issue between wealthy and developing countries at the United Nations. Rich countries, often home to ultra-rich individuals and major corporations, have consistently resisted efforts to establish a new global tax convention and equitable tax regime.
On August 16, 2024, the UN Ad Hoc Committee approved the Terms of Reference (ToR) for establishing a UN Framework Convention on International Tax Cooperation (or UN Tax Convention for short). The ToR draft will serve as a blueprint for negotiating the convention on international tax cooperation, set to take place between 2025 and 2027 before it moves towards ratification.
Though the road to a UN Tax Convention is long and arduous, the completion of the ToR is a historic victory for global tax justice. It was achieved through the staunch leadership of the Africa Group of countries and the unity and determination of the Group of 77 countries. Supported by 110 UN members, the ToR faced opposition and abstentions from the EU, the US, Japan, Korea, and several others, mostly OECD countries. These UN Tax Convention ‘blockers’ cited concerns over decision-making processes and alignment with existing international forums. Ironically, existing international tax platforms under the OECD had for years been criticized by developing countries and independent experts as exclusive clubs that protect only the interests of multinational corporations and the rich industrialized countries such as those in the G7. Deliberations around the ToR highlight the fundamental differences of interests between the Global South and wealthier nations over fair tax practices and equitable taxing rights across countries. That the vote on the ToR went towards a positive direction for global tax justice proves that there is hope in transforming global tax governance long dominated by the rich countries, and in making the global tax system ‘work for people and the planet.’
Jeannie Manipon, of the Asian Peoples’ Movement (APMDD) and the Tax and Fiscal Justice Asia (TAFJA) commended the leadership of the African Group and G77 countries who enabled the adoption of the ToR. “The adoption of the ToR is a collective rejection of non-inclusive and undemocratic international tax forums and platforms. The fight to make global tax rules work for people and the planet continues and we call on civil society and the media to engage in the next steps of this process,” she said.
“Our current global tax system enables flawed and regressive policies which deepen inequalities, both between and within countries. The ToR sets a blueprint to ending global tax abuse and enabling developing countries to generate the revenue needed to deliver on human rights obligations, gender equality commitments, and the sustainable development goals,” she stressed. Wealthy nations, home to many multinational corporations and billionaires will continue to oppose measures that threaten their economic interests and longstanding tax privileges. Powerful corporations and wealthy individuals will search for new loopholes as old ones are closed. This calls for continued vigilance and advocacy not only from tax justice activists but a broader community of all people – journalists, independent experts, economists, public officials, business leaders, and tax accountants – who desire an end to wealth inequality and the beginning of a new era where financial transparency, accountability, integrity, fairness, and equity shape international standards and our tax systems. (Alladin Sidro Diega with the APMDD Development Finance Program Team )
The Origin of Wealth Hoarding and the Drivers of Wealth Inequality: Tax Cuts for the Wealthy and Labor Rights Cuts for the Workers
The economic and social implications of wealth accumulation are profound. While the super-rich hide trillions of dollars in secret accounts, millions around the world struggle with hunger and economic survival. Since 2022, the gap between the wealthy and the rest of society has only widened, exacerbated by global crises such as the COVID-19 pandemic and ongoing conflicts. Updated statistics paint a grim picture of inequality, with the hoarding of wealth contributing to the suffering of countless individuals.
Hoarding can be traced back to the rise of patrimonial capitalism, a term popularized by French economist Thomas Piketty in Capital in the 21st Century. Piketty’s research shows that wealth accumulation has historically been concentrated in the hands of a few families, who have passed down their fortunes across generations. This system was especially prominent in Europe during the 19th and early 20th centuries, where wealth was primarily inherited rather than earned through labor or entrepreneurship. This led to a rigid class structure, with a small elite controlling the majority of resources while the vast majority of the population remained economically marginalized.
According to Piketty, this concentration of wealth was temporarily disrupted by the two World Wars and the Great Depression, which led to the destruction of capital and a substantial redistribution of wealth through progressive taxation and social welfare programs. However, since the 1980s, there has been a renewed concentration of wealth, particularly in developed countries, driven by neoliberal economic policies that favor deregulation, tax cuts for the wealthy, and the weakening of labor rights. This has caused the rate of return on capital (r) to consistently exceed the rate of economic growth (g), further exacerbating inequality.
Conversely, contemporary wealth hoarding has been facilitated by wealth managers who specialize in helping the ultra-rich protect and grow their fortunes through various financial mechanisms, including trusts, offshore accounts, and shell companies. According to Brooke Harrington, these professionals operate in a transnational space, effectively placing wealth beyond the regulatory reach of any single nation-state. This issue was further explored by Chuck Collins in his 2021 book, The Wealth Hoarders: How Billionaires Pay Millions to Hide Trillions.
Liam Byrne’s 2024 book, The Inequality of Wealth: Why it Matters and How to Fix it, examines the structural factors contributing to wealth inequality, highlighting the role of inherited wealth and the impact of neoliberal policies. In the book, Byrne advocates for comprehensive reforms, including the implementation of wealth taxes.