Sigmundur Gunnlaugsson stood down on Tuesday following one of the largest political demonstrations ever seen in Reykjavik.
The centre-right prime minster faced pressure to resign over allegations in the documents leaked from Panama law firm Mossack Fonseca that he used to own a British Virgin Islands (BVI) company that now belongs to his wife.
An estimated 22,000 – almost 7% of Iceland’s population of roughly 320,000 residents – turned out in protest on Monday, calling for Gunnlaugsson’s resignation.
But the prime minister has said he is not stepping aside permanently, merely for an “unspecified amount of time”, according to the Financial Times.
“It's a private matter in so far as it's a privately held interest, but it's not a private matter if tax has not been paid."
Sins of the father
Closer to home, Downing Street has given David Cameron critics easy ammunition with its statement that the offshore tax affairs of the Prime Minister were a “private matter”.
The Panama Papers implicated the PM over historical offshore dealings by his late father, Ian Cameron.
According to the International Consortium of Investigative Journalists (ICIJ), with which the 11 million leaked documents were shared, multimillionaire stockbroker Ian Cameron was a client of Mossack Fonseca, said to have used the law firm to shield his investment fund, Blairmore Holdings from the UK tax office.
Mossack Fonseca registered the fund in Panama despite most of its investors being British, and Ian Cameron controlled the fund from its inception in 1982 until he passed away in 2010.
According to the ICIJ, the Blairmore Holdings prospectus said it, “should be managed and conducted so that it does not become resident in the United Kingdom for United Kingdom taxation purposes”.
The fund was run using untraceable ‘bearer shares’, and naming ‘nominee’ company officers based in the Bahamas, according to the leaked records.
Independent investigation
Labour party leader Jeremy Corbyn has called for David Cameron to “set the record straight” and make his personal tax records publicly available.
At a Harlow press event on Tuesday, Corbyn said: “It’s a private matter in so far as it’s a privately held interest, but it’s not a private matter if tax has not been paid. So an investigation must take place, an independent investigation.”
At a PwC event in Birmingham on Tuesday, David Cameron was questioned over whether he or his family had benefited or stood to benefit, now or in future, from the trust in question or any other offshore holdings.
Cameron said: “In terms of my own financial affairs, I own no shares. I have a salary as prime minister and I have some savings, which I get some interest from and I have a house, which we used to live in, which we now let out while we are living in Downing Street and that’s all I have. I have no shares, no offshore trusts, no offshore funds, nothing like that.”
