Indonesia failure to properly tax pulp trade

“There’s a sense of danger,” a local teenager told ICIJ reporter Scilla Alecci, as they surveyed burnt-out fields in the heart of Indonesia’s logging country during a 2017 reporting trip.

Scilla had travelled to Padang in Indonesia as part of ICIJ’s Paradise Papers investigation to see the destruction wrought as lush peatland forests were cleared to make way for palm oil and pulp plantations.

The teenager, who lived in a village nearby, pointed to the charred remains of sago palm trees. “The effects of forest burning and deforestation are enormous” for both humans and animals, he told Scilla.

Scilla’s story would reveal the pivotal role played by lawyers and bankers supporting the expansion of one of the world’s largest pulp and paper producers, APRIL, despite the company’s poor environmental record and social conflicts.

Three years later, on the anniversary of the Paradise Papers, the company is back in the headlines, with a new report by the Tax Justice Forum accusing APRIL of misreporting its exports while shifting profits offshore to avoid taxes in Indonesia. APRIL has denied wrongdoing.

One of the authors of the report told Scilla that Indonesia’s failure to properly tax pulp trade was hurting the government’s ability to provide for its people. “That’s money that could have gone to education, or health, or development, public investment in some way. And now it’s not going there.”

The United States Treasury Department is putting art galleries and museums on notice over the high risks of financial crime in their trade, warning that various aspects of the art industry makes “it attractive to those engaged in illicit financial activity, including sanctions evasion.”

From Morocco to Jordan, journalists across North Africa and the Middle East explored secretive reports that detailed billions of dollars in potentially suspicious transactions to and from the region’s most powerful companies and government institutions.

Hamish Boland-Rudder, ICIJ’s online editor

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