Tag Archives | Taxes

Treasure Islands: The Murky World Of Offshore Tax Shelters

3446025121_072700607fNew Left Project sits down with author Nicholas Shaxson to talk tax havens — a mammoth system of quasi-legal money-laundering which has a far wider impact than we realize, with a large role in the global drug trade and financial crisis. As it turns out, the biggest “treasure islands” are not the Caymans or Monaco, but places such as the City of London and the U.S. state of Delaware:

There is no common definition of what a tax haven is. Everybody has a slightly different definition. Ultimately what a tax haven provides is escape from the rules and the laws of jurisdictions. Tax havens are also about ‘elsewhere’ – the laws of the Cayman Islands are not designed for the benefit of the 50,000-odd population of the Cayman Islands.

The traditional view is…palm-fringed tropical islands in the Caribbean, Monaco, Switzerland, Liechtenstein. Small states. But if you do the analysis of what a tax haven is and what they are selling, you will find that these small islands are generally sideshows to the big event.

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U.S. Government Admits To Massive Waste Of Taxpayers’ Money

Just to get you even more excited about paying your taxes next month, the U.S. Government Accountability Office reports that billions of those tax dollars are wasted every year. Damian Paletta reports for the Wall Street Journal:
The U.S. government has 15 different agencies overseeing food-safety laws, more than 20 separate programs to help the homeless and 80 programs for economic development. These are a few of the findings in a massive study of overlapping and duplicative programs that cost taxpayers billions of dollars each year, according to the Government Accountability Office. A report from the nonpartisan GAO, to be released Tuesday, compiles a list of redundant and potentially ineffective federal programs...
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Swiss Banker Gives WikiLeaks Damning Data On Wealthy Tax Evaders

Wikileaks logoAnother week, another round of WikiLeaks. Clearly there are no sacred cows and in fact it is the biggest targets who are going down fastest, from corrupt governments to cheating taxpayers. Playing the Bradley Manning role this time is ex-Bank Julius Baer executive Rudolf Elmer. AP/Yahoo News has the story:

A former Swiss banker on Monday supplied documents to WikiLeaks that he alleges detail attempts by wealthy business leaders and lawmakers to evade tax payments.

Rudolf Elmer, an ex-employee of Swiss-based Bank Julius Baer, said there were 2,000 account holders named in the documents, but refused to give details of the companies or individuals involved.

He has previously offered files to WikiLeaks on financial activities in the Cayman Islands and faces a court hearing in Zurich on Wednesday to answer charges of coercion and violating Switzerland’s strict banking secrecy laws.

“I do think as a banker I have the right to stand up if something is wrong,” said Elmer, who addressed reporters at London’s Frontline Club alongside WikiLeaks founder Julian Assange.

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Romania Legally Recognizes Witchcraft As A Profession

The Romanian government has recognized jobs such as witches, embalmers and driving instructors, as professions. The interest was in gaining income tax as an effort to recover from the nation’s recession. From The Huffington Post:

Romania has changed its labor laws to officially recognize witchcraft as a profession, prompting one self-described witch to threaten retaliation.

The move, which went into effect Saturday, is part of the government’s drive to crack down on widespread tax evasion in a country that is in recession.

In addition to witches, astrologists, embalmers, valets and driving instructors are now considered by labor law to be working real jobs, making it harder for them to avoid income tax.

For months the measure had been debated, protested by witches and mocked by the media.

On Saturday, a witch called Bratara told Realitate.net, the website of a top TV station, that she plans to cast a spell using black pepper and yeast to create discord in the government.

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Wealthy Americans Should Give Away Their Tax Cut

A group of Ivy League professors is urging wealthy Americans to donate their gains from the controversial Bush tax cuts that should have expired at the end of 2010, only for Republicans in Congress to force an extension. At their site Give It Back For Jobs they explain:

Give It Back For Jobs
When the Bush administration took power in 2001, it enacted massive tax cuts that disproportionately benefited the wealthiest Americans. These beneficiaries represented the very segment of American society that had already seen their share of national income balloon over the prior generation.

The cuts were defended in the name of the unexpected budget surpluses produced by the growth of the Clinton years. Even so, President Bush could not convince enough of the Senate that the cuts were affordable to make them permanent, and so they were set to expire next year.

It is now clear that the budgetary consequences of these skewed tax cuts have been dire.

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States Plan Taxes To Comprise Up To 21% Of E-Book Price

Kindle 2. Photo: Jon 'ShakataGaNai' Davis (CC)

Kindle 2. Photo: Jon 'ShakataGaNai' Davis (CC)

Those of us hooked on $9.99 ebooks had better get used to the idea of paying more in 2011. Not only are publishers and authors realizing that they are not making enough money to stay in business at that price point, but now state governments want in on the fast-growing sales. SmartMoney reports:

Taxes on e-book downloads to an e-reader, like the iPad, Kindle or Nook, could add up to 21% of the total price, assuming multiple states apply taxes to the same transaction, according to MyWireless.org , a nonprofit consumer advocacy group.

Roughly 9 million e-reader users download books. (On average, that’s three e-books a month at an average of $9 per book, according to Marketing and Research Resources and CEA, respectively.) These consumers are increasingly at risk of being taxed on those purchases by their home state and by the state where the book is published, says a CTIA spokeswoman.

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The Economy of The Crow: Bird Brains Want to Throw Away $116 Billion A Year to Benefit The Richest 1.3% ‘Small’ Business Owners

There is an old folk saying that comes down from the Irish tradition:  “The economy of the crow”.  It’s uttered whenever some old wag wishes to describe, in a dryly pithy manner, a short-sighted and foolish resource management strategy.  It supposedly is derived from the habit of scavenger birds like crows who, upon noticing an unharvested bit of carrion ripe for the picking, tend to drop whatever goodies they may currently have in their clutches in order to go in pusuit.  Basically the saying is a ridicule, a chastisement of stupid waste.
Economy of The Crow
While that kind of bird-brained buffoonery may be understandable in a creature with the cranial capacity of a thimble, it’s not the type of responsible management practice we expect from our elected representatives.  Certainly not from the members of the party that claim in one breath to be both the party of fiscal responsibility and the party of deep business savvy. … Read the rest

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Do Tax Cuts for the Richest 2% Help or Hurt You? Read the Surprising Answer Here

Kudos once again to the fine team and readership at disinformation. Their comments continue to be extremely thought provoking. This article, chart and supporting calculation in the attached workbook are in resonse to their many insightful questions about inept Republican tax and economic policies.

Read The Surprising Answer Here
I get pissed when some dipwad tries to pull a fast one on me, as should we all.  The responsible conduct of business requires a level of trust that is decisively undermined when we’re lied to.  And while there is a time and place for everything, the place for bullshit is the weekend pintfest at a local pub, not in debates about income tax policy.  That’s why the fundamental dishonesty of Republican’t talking points has me so fired up.

The specific steaming pile that currently has me cheesed off is EGTRRA.  No, it’s not some type of horrible fat-free egg substitute; it’s the ironically named Economic Growth and Tax Relief Reconciliation Act of 2001. 

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Google Tax Scandal

alg_google-flamesWe all know that there are some genius-level minds at Google, and now it seems they’ve applied their high-powered IQs to working out how not to pay taxes. Guys, can you create an app for that — I’d like to pay 2.4% tax too! From Bloomberg News:

Google Inc. cut its taxes by $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda.

Google’s income shifting — involving strategies known to lawyers as the “Double Irish” and the “Dutch Sandwich” — helped reduce its overseas tax rate to 2.4 percent, the lowest of the top five U.S. technology companies by market capitalization, according to regulatory filings in six countries.

“It’s remarkable that Google’s effective rate is that low,” said Martin A. Sullivan, a tax economist who formerly worked for the U.S. Treasury Department. “We know this company operates throughout the world mostly in high-tax countries where the average corporate rate is well over 20 percent.”

The U.S.

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Soak The Very, Very Rich

A sensible suggestion from the capable mind of The New Yorker‘s James Surowiecki, but what are the chances that our government will implement it, one wonders (whilst thinking of all those campaign contributions made by the very rich):

The fight on Capitol Hill over whether to extend the Bush tax cuts is about many things: deficit reduction, economic stimulus, supply-side ideology. But at its core is a simple question: who counts as rich? The Obama Administration’s answer is that you’re rich if you make more than two hundred thousand dollars a year as an individual or two hundred and fifty thousand dollars a year as a household, and therefore you should have your taxes raised. Conservatives suggest that this threshold is far too low, and argue that Obama would be taxing mostly small-business owners, or the people a Fox News host has referred to as “the so-called rich,” rather than fat plutocrats.

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