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Senators Set Sights On Overseas Tax Havens
Bloomberg News ^ | 18 Feb 2007 | Mark Drajem and Ryan J. Donmoyer

Posted on 02/19/2007 12:17:34 AM PST by FLOutdoorsman

Three senators proposed legislation that would target what they say is $100 billion a year in tax revenue lost each year because of overseas tax havens, in part by forcing hedge funds to track their foreign investors.

The measure would impose tougher requirements on U.S. taxpayers using offshore secrecy jurisdictions, give the U.S. Treasury the authority to take action against foreign jurisdictions that impede tax enforcement, stiffen penalties against abusers and close offshore trust loopholes, according to a summary of the bill released by Michigan Democrat Carl M. Levin.

The legislation would require hedge funds to establish programs to combat money laundering and better track offshore investors, under guidance from the Treasury Department. The measure would also prohibit the U.S. Patent and Trademark Office from issuing patents for accounting strategies intended to "minimize, avoid, defer, or otherwise affect liability for federal, state, local, or foreign tax."

"We cannot tolerate tax cheats offloading their unpaid taxes onto the backs of honest taxpayers," Levin said in a joint statement with co-sponsors Norm Coleman (R-Minn.) and Barack Obama (D-Ill.). "Offshore tax havens have declared economic war on honest taxpayers by helping tax cheats hide income and assets that should be taxed in the same way as other Americans."

The Treasury Department and top lawmakers in both houses of Congress have made a priority this year reducing the so-called tax gap, the difference between what individuals and companies owe and what they pay. The IRS said a study of 2001 tax returns shows the tax gap is about $345 billion a year, only $55 billion of which is recovered.

(Excerpt) Read more at washingtonpost.com ...


TOPICS: Business/Economy; Foreign Affairs; Government
KEYWORDS: banking; financialfreedom; havens; offshorebanking; overseas; tax
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1 posted on 02/19/2007 12:17:36 AM PST by FLOutdoorsman
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To: FLOutdoorsman
There are two ways to look upon this. It is absolutely true that 100 billion a year is being siphoned off to places like the Bahamas, Luxembourg, Panama, etc. It used to be the ultra rich doing it...but there are junior millionaires...guys with barely a million or two...who are becoming savvy on beating the US government's tax game. There are members of the house and senate who are active players of such "trusts" or games...Teddy Kennedy for example...wrote laws that truly aid his own investments.

But on the other side of the coin...for every change that they can dream up...there is a financial analyst sitting there and dreaming up the next way to avoid taxes. There are hundreds of guys now...who own fake businesses in Panama...and have sailboats running down to the country loaded with cash reserves from their businesses in the US. They buy into real estate in Panama, or hotels...or just pump the money into other 3rd world countries like Chile or Argentina to get into "trustful" investments. The idea of having $20 million a year going into their hands...and paying the US government potentially $5 million...just ain't going to work. If you take risks in life and business...you expect the rewards to be worth the effort. You don't expect the government to tally up your fortune and hand over money to some university project in Alaska to determine if polar bears can swim as good as brown bears.

Let the senators waste as much time as possible on this. The mere fact they won't touch social security for repairs...signals their real intentions.
2 posted on 02/19/2007 12:43:46 AM PST by pepsionice
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To: pepsionice

Good post. The U.S. Government could enjoy better collections of taxes if they reduced the burden and cut spending.


3 posted on 02/19/2007 2:33:01 AM PST by Jimmy Valentine (DemocRATS - when they speak, they lie; when they are silent, they are stealing the American Dream)
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To: pepsionice

bump!


4 posted on 02/19/2007 3:22:34 AM PST by Leisler (REAL ENVIRONMENTALISTS WALK.)
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To: pepsionice

Typical liberals. They want your money. It's redistribution of wealth.


5 posted on 02/19/2007 3:33:00 AM PST by Leftism is Mentally Deranged
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To: FLOutdoorsman

Oh goody, more money for our elected officals to waste and steal.


6 posted on 02/19/2007 4:17:18 AM PST by chiefqc
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To: FLOutdoorsman
Our federal government don't have enough money so it is seeking to eliminate tax shelters. Senator Carl Levin is right - 1.2 TRILLION in revenue is not enough.

"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." - Manuel II Palelologus

7 posted on 02/19/2007 4:23:07 AM PST by goldstategop (In Memory Of A Dearly Beloved Friend Who Lives In My Heart Forever)
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To: Leftism is Mentally Deranged

"Typical liberals. They want your money. It's redistribution of wealth."

I am assuming that the Swimmer will be immune from this?


8 posted on 02/19/2007 4:56:19 AM PST by EQAndyBuzz (The Clintons: A Malignant Malfeasance of the Most Morbid)
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To: FLOutdoorsman
in part by forcing hedge funds to track their foreign investors.

What this means is that hedge funds, along with many other stock-related funds, will not only move their HQ out of the USA, but, they will bar US investors.

Those already sheltering their money, will simply have to move it offshore first, then put it into the funds.

Country getting the business will thus most likely be England, as the City of London is now a financial powerhouse.

9 posted on 02/19/2007 5:03:21 AM PST by ikka
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To: Leftism is Mentally Deranged

We are already noncompetitive in the world based on ridiculous tax regulation. There is a reason you don't see US management....we need to pay taxes everywhere... So companies hire other people to run global businesses. US owners have too much regulation to own overseas and attract too much attention from our own government for their business activities. Foreign investors have less interest in investing in US business anywhere in the world because the USG will tax them coming and going and burrow into their international records under the guise of national security.....It is about revenue plain and simple. If we want to end up like Argentina this is the path!


10 posted on 02/19/2007 5:09:00 AM PST by colonialhk (Power and Money,the new mantra of the left!)
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To: ikka

Spot on!


11 posted on 02/19/2007 5:10:28 AM PST by colonialhk (Power and Money,the new mantra of the left!)
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To: FLOutdoorsman
Bring in On!

NO TAXATION WITHOUT REPRESENTATION!

As an American citizen living overseas did anyone here realize that people like me have NO CONGRESSMAN that represents us.

An American Expat in Southeast Asia

12 posted on 02/19/2007 5:13:55 AM PST by expatguy (http://laotze.blogspot.com/)
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To: FLOutdoorsman

Sadly I'm sure Congress never stopped to think about the root cause of the problem (i.e. what regulations are forcing this money overseas?). They can try to stick their finger in the dyke, but as fast as they can write legislation is how fast smart financial advisers will be findings ways around it.


13 posted on 02/19/2007 5:18:48 AM PST by NittanyLion
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To: FLOutdoorsman

Is George Soros an American citizen? If so, then Levin should start with him, he hides his billions in Curacoa but deigns to "run" the American left from his offices in New York. These kinds of creeps are the ones really hurting the American economy, let's start by going after Sorry Soros.


14 posted on 02/19/2007 5:25:31 AM PST by Rockiette (Democrats are not intelligent!)
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To: expatguy
This battle has been fought for decades and yet anything outside the US has been fair game. The IRS spends more than it collects overseas from citizens....great mindset in DC.

This all began when a few Hollywood types moved to Europe and didn't pay "their fair share" of taxes.

The lesson is "shame on you for working internationally" You should have stayed home and sold used cars. sarc!
15 posted on 02/19/2007 5:27:32 AM PST by colonialhk (Power and Money,the new mantra of the left!)
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To: chiefqc
"Oh goody, more money for our elected officals to waste and steal."

That's the bottom line, isn't it? Very frustrating.

Carolyn

16 posted on 02/19/2007 5:28:17 AM PST by CDHart ("It's too late to work within the system and too early to shoot the b@#$%^&s."--Claire Wolfe)
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To: colonialhk

Fine then, give us representation.


17 posted on 02/19/2007 5:30:15 AM PST by expatguy (http://laotze.blogspot.com/)
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To: expatguy

So if you get a Rep you are ok with paying taxes to the US and Malaysia and the cost of compliance and no access to the services for which you pay.


18 posted on 02/19/2007 5:34:07 AM PST by colonialhk (Power and Money,the new mantra of the left!)
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To: colonialhk

I won't pay tax twice no.


19 posted on 02/19/2007 5:40:23 AM PST by expatguy (http://laotze.blogspot.com/)
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To: expatguy

I guess you could justify a cozy 757 for that rep......
Then the reps for DC would want the vote....lol


20 posted on 02/19/2007 5:42:05 AM PST by colonialhk (Power and Money,the new mantra of the left!)
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