Explained: The tax evasion case against Shakira in Spain, for which she could face over 8 years in prison

What is the tax case against Shakira?

Spanish authorities have accused the singer of defrauding the country’s tax office out of €14.5 million by avoiding paying personal income tax and estate tax, the Spanish daily El País reported.

Shakira is accused of failing to pay taxes between 2012 and 2014, a period when prosecutors claim she was in a relationship with Spain and FC Barcelona centre back Gerard Piqué, and lived in a house that she had purchased in Barcelona, while officially maintaining a tax residency in the Bahamas. (Shakira and Piqué announced they were splitting earlier this year.)

Spanish authorities first began investigating her finances in 2018. The prosecution has based its case on reports maintained by the Spanish tax agency, which recorded her visits to hairdressers, beauty salons, the medical clinic she visited while she was pregnant, and a recording studio she rented in Barcelona, to prove that she spent more than 183 days in Spain, the legal requirement that makes her a Spanish tax resident, El País reported.

A Spanish judge ruled in July 2021 that there was enough evidence to suggest that she had committed tax fraud. On Wednesday (July 27), Shakira rejected a settlement deal offered by Spanish prosecutors, and instead chose to go to trial, which will likely begin in the coming weeks.

Shakira’s defence

Shakira’s defence team has argued that she did not stay in Spain for long enough between 2012 and 2014 to attract the provisions of Spanish tax laws — and that she only officially resided in Spain in 2015. Accusing the prosecutors of “abusive methods”, Shakira on Wednesday argued that they were “insisting on claiming money earned during my international tours and the show ‘The Voice’”, for which she was a judge in the United States, AFP reported.

Shakira has maintained that she has already paid €17.2 million in taxes, and that she owes nothing more, Reuters reported. She has said that she is entirely confident of her innocence, and that she is willing to “resolve any differences” if the allegations are found to be legitimate.

Past controversies

Shakira was one of the celebrities whose name figured in the Paradise Papers and Pandora Papers global media investigations that were published in November 2017 and October 2021 respectively. The Indian Express partnered with the International Consortium of Investigative Journalists (ICIJ) in both collaborative investigations.

The Paradise Papers, which followed the sprawling Panama Papers investigation, were a cache of 13.4 million corporate records, primarily from the Bermuda-based firm Appleby, as well as from Singapore-based Asiaciti Trust and corporate registries maintained by governments in 19 secrecy jurisdictions that are often referred to as “tax paradises”. The Paradise leaks were obtained, like the Panama leaks, by the German newspaper Süddeutsche Zeitung, and shared with the ICIJ.

The Pandora Papers were 11.9 million leaked files from 14 global corporate services firms which set up about 29,000 off-the-shelf companies and private trusts in not just obscure tax jurisdictions but also countries such as Singapore, New Zealand, and the United States, for clients across the world