Celebrities and Tax Evasion: What To Do?

Last week it was revealed that a Spanish Prosecutor requested 8 years and two months in prison for Shakira for at least six crimes against the Treasury of that country. The singer broke off the conversations of her legal team with the investigating body to reduce her sentence since she considers herself innocent and hopes to prove it in court.

According to the Public Ministry, the singer declared that she did not reside in Spain during 2012 and 2014 when she did, although her address was in the Bahamas at that time. Only until 2015 Shakira declared Spain as her country of residence.

Despite the scandal that the Barranquilla-born singer is going through, her case is just another one in the world of celebrities. The only bad precedent for Shakira is that in one way or another, almost all the celebrities who have had fiscal problems have had to repair the treasury monetarily or with jail time.

Shakira is not the first: Celebrities who committed tax evasion

Within the world of music, it has been seen how the legend of rock & roll, Chuck Berry, had to pay 110 thousand dollars plus a sentence of four months in jail and a thousand hours of community service in 1979 for tax evasion; among Latin American celebrities is the case of Marc Anthony, who had to reach an agreement with the United States Internal Revenue Service (IRS) for a $3.4 million fine for tax evasion. Prince and Whitney Houston were some other music celebrities who had financial troubles paid off.

Shakira is also not the first Colombian celebrity to have tax problems in Spain. In 2017, Falcao García pleaded guilty to having committed tax fraud to the Treasury of Spain between 2012 and 2013 for a figure of 8.2 million euros. This happened when the footballer played for Atlético de Madrid. The Colombian reached an agreement with the Prosecutor's Office that reduced the fine and also eliminated the request for jail time for him.

Among soccer players, tax evasion has not been strange. By coincidence, the two best footballers of this era: Cristiano Ronaldo and Lionel Messi were convicted of tax evasion. The two paid millionaire sums as reparation and also have a prison sentence, which they knew how to avoid by being so short on time and not having a criminal record.

Read also: Breaking News: Spanish Prosecutor Asks for 8 Years in Prison for Shakira

Why do they evade taxes?

The reason that makes celebrities evade taxes is the same for millionaires and politicians: by having large sums of money in their accounts, the amount they have to pay back to the Treasury is much higher, which is why they look for tax havens or front or shell companies.  All this was recorded in the scandal of the 'Panama Papers' or 'Pandora Papers', where Shakira and hundreds of other millionaires also appear.

In several countries, there are figures that make the tax burden not so high. In Colombia, several non-profit organizations, also known as foundations, receive incentives from the State so that the percentage of the payment in taxes is lower. In fact, one of the most important foundations in the country is promoted by Shakira: 'Pies descalzos'.

As the count was done, tax evasion is not a novelty among people with high purchasing power, as is the case with celebrities. Spain has been rigorous and its convictions prove it, but the fight will continueas long as there are tax havens and there is no regulation of paper companies.