Iceland’s prime minister recently resigned after thousands protested after the Panama Papers investigation revealed that the world’s most wealthy–including the prime minister–had evaded taxes.
Sigmundur Gunnlaugsson stepped down from his position as prime minister on Tuesday, April 5, hours after thousands of protesters demanded his resignation outside Iceland’s parliament. Agriculture Minister Sigurdur Ingi Johannsson told Icelandic broadcaster RUV that Gunnlaugsson was stepping down as prime minister and that he would replace the prime minister for an interim period.
Panamanian law firm Mossack Fonseca leaked more than 11 million documents, showing instances where the world’s most wealthy had evaded taxes, including Gunnlaugsson. According to the International Consortium of Investigative Journalism (ICIJ), a non-profit in the United States, 11.5 million documents showed the offshore holdings of a dozen world leaders and wealthy celebrities, including businessmen, criminals, celebrities, and athletes.
According to the leaked documents, the Panamanian law firm helped Gunnlaugsson and his wife establish a company called Wintris in the British Virgin Islands.
The former Icelandic prime minister is accused of failing to disclose his involvement in the company, which held interests in failed Icelandic banks that the Icelandic government oversaw. Iceland was in a prolonged financial crisis after its biggest commercial banks collapsed back in 2008.
“He [Gunnlaugsson] is the first casualty of the Panama Papers,” Al Jazeera‘s Laurence Lee reported from Reykjavik. “Iceland is clearly a functioning democracy. People have said they’re not prepared to put up with it. As soon as it [the leak] started to come out on Sunday, people took to the streets.”
Gunnlaugsson quit ahead of a planned vote to call for a new election. Opposition parties continued their call for a snap election even after the former prime minister’s resignation.
In addition to Gunnlaugsson, Argentine President Mauricio Macri and Ukrainian President Petro Poroshenko are mentioned in the leak, which links 12 current and former heads of state as well as 143 other world politicians to the illegal financial transactions.
The Panamanian law firm made a statement, rejecting any wrongdoing.
“These reports rely on supposition and stereotypes and play on the public’s lack of familiarity with the work of firms like ours,” Mossack Fonseca stated late Monday, April 4.
President Barack Obama made a statement on Tuesday, April 5, saying that tax avoidance is a global issue and that wealthy people and corporations are taking advantage of tax code loopholes that the average taxpayer does not have access to.