Friday, August 05, 2016

Out of Africa, Into Tax Havens

Batman “The rich. You know why they’re so odd? Because they can afford to be.”
–Alexander Knox (Robert Wuhl) via Pop up Stories @ Negus/Connors Attitude to Absinthe (AA)

News from the Profession. When It Comes to Overcomplication, Accountants Take the Cake (Megan Lewczyk, Going Concern)

The ATO has issued Decision Impact Statement [DIS: Commissioner of Taxation v. Donoghue] on the decision in FCT v Donoghue [2015] FCAFC 183 

iNOW! began as a way to address the need – recognised by top judges – for those working with legislation to get better at reading it. ...
Traditionally, there was a view that tax Acts ‘should receive a strict construction’1. Hill J said it would be ‘a sad day’ if the rule were abandoned, as this could lead to ‘sloppy drafting’2. Kirby J disagreed, famously saying that a tax Act is ‘just another statute’3. Where are we now on this? With little fuss in 2009, the High Court confirmed that ‘tax statutes do not form a class of their own’4. It is now uncontroversial that the same rules apply to them5. The tax nature of an Act is still part of its context, but this is just one factor to be weighed in the purposive process. iTip – use normal purposive interpretation for tax Acts without automatically favouring the taxpayer or the Commissioner.
ATO's Legal Eagles: interpretation NOW! Episode 14 circa 29 July 2016 AD

"What is legal interpretation anyway?" Will Baude has this guest post at "The Volokh Conspiracy."

New Zealand foreign trusts the scandals the reforms and throat clearing from the European observers ... 

HMRC uses a variety of methods to tackle serious tax frauds, including levying large penalties and initiating civil fraud investigations. But it usually reserves criminal investigations for a small number of cases due to their lengthy, expensive and uncertain nature. In March last year, the government started consultations on implementing a new corporate criminal offence for firms failing to prevent tax evasion. If enacted this will implicate advisers who have inherited clients with offshore bank accounts, Pinsent Masons head of tax Jason Collins said at the time.
Bank of England cuts key rate to historic low (Lowest in 322 Years) : 0.25 per cent ... Expect more dire mini-wars breaking up in the shakiest parts of Africa and South Sea Asia regions ... (Hat tip to bohemian agents who follow the money and secret arms / bomb trafficking before the mainstream media digs the data ...) More on foreign agents operating in the United States.  This issue will only pick up steam...

HM Revenue & Customs (HMRC) is exploring how it can better publicise fraud investigation outcomes and increase the impact of the sanctions it uses, in order to dispel the myth “people are getting away with tax evasion”. 
The department said it wants to give the public confidence it is going after wealthy tax evaders and also to deter others from pursuing fraudulent activity. This followed criticism from the Public Accounts committee in a report in April, which told HMRC it must "do more to tackle tax fraud and counter the belief that people are getting away with tax evasion."  HMRC explores tougher methods for publicising tax fraud by the wealthy

Revenue investigating complex fraud linked to offshore trusts
HMRC arrests three advisers over £132m tax fraud

If Apple paid taxes on offshore assets, it'd cover most of the U.S. education budget

The USAO SDNY announced yesterday here that a prominent New York Art Consultant, Lacy Doyle, has been indicted for one count each tax obstruction, 7212(a), and tax perjury (7206(2)), both being 3 year maximum felonies with a resulting aggregate maximum sentence of 6 years.  The indictment was handed down earlier but unsealed with the announcement of the arrest yesterday.  The indictment is enclosed ...

Oxfam in call for crackdown to combat money launderers using Scottish shell firms Herald Scotland. Our Richard Smith has a byline! And some related stories: Mystery as dissolved Scottish firm Childwall Systems provides armed guards in Ukrainian war zone and Fuerteventura Inter: Scots firm at centre of organised crime probe into weapons deal 

“Dark money” just got a bit of light shined on it, thanks to a new search tool unveiled today by the Center for Public Integrity. The Center downloaded 850,000 forms from about 250,000 nonprofits that were recently released in electronic format by the IRS; we extracted the grant data and made $170 billion reported over five years searchable.
New search tool traces sources of ‘dark money’

Why Tax Havens Are Political and Economic Disasters 

Highest-paid CEOs run worst-performing companies, research findsIndependent (Dan K). Study here. Note this is not a new finding, but this study does an important job in differentiating between “summary pay” which is what is reported v. what they actually took home. 
The Establishment will always attempt to characterise any root challenge to its hegemony and ideology as violent, atavistic and subscribing to appalling beliefs and behaviour. The theme of challengers as “Barbarians” runs through history. We will have to put up with it for some time. The good news is, they are seriously rattled

Each year, tourists cross the plains of central Zimbabwe to sleep near the roar of Victoria Falls, track elephants, cheetahs and pangolins, and dine under the stars.
The visitors are accompanied every step of the way by John Stevens, a man who has been called “perhaps the finest guide to come out of Zimbabwe.”
And while Stevens’ safari business is very much Zimbabwean, his financial universe is a classic creation of offshore globetrotting. Stevens’ financial affairs, outlined in years of correspondence with Mossack Fonseca, the law firm at the center of the Panama Papers scandal, reveal how the poetry of Africa’s savannahs mixes with the day-to-day paper-pushing of offshore management.
Out of Africa, Into Tax Havens

Geoff Leeper?s stunning snow-gum on Mt Bimberi.
Geoff Leeper's stunning snow-gum  on Mt Bimberi. Photo: Geoff Leeper

A humorous starter guide as to how multinational engage in legal tax evasion, and how to tell Apple to cut it out.
We’re happy to share a rather brilliant explanation of corporate tax
reductionerm, elimination shennanigans from the news and political satire show in Australia, The Undercurrent. In their words:
“Thousands of global companies avoid paying tax.  That leaves us, taxpaying citizens, to pick up the tab. So we humbly present to you The Undercurrent Guide to Legal Tax Evasion.  If you’re as pissed off as we are, you can do something about it here.” (More on their #iPhone7Boycott petition below.)
*Video: Guide to Legal Tax Evasion (With #iPhone7Boycott)

The son of one of Mr. Till’s killers name seems to show up in the Panama Papers.  According to the Clarion Ledger, “Harvey T. Milam of Ocean Springs, whose father, J.W., shot Till in 1955, appears in” the Panama Papers.  Apparently, Harvey had quite a scheme involving using off-shore insurance companies.  I may actually have to do some digging around to find out more about the alleged scheme.

Emmet Till and The Panama Papers

Panama Papers reveal scale of offshore firms' African operations

Panama Papers Reveal Wide Use of Shell Companies by African Officials

Taxman calls time on Ernst & Young tax avoidance schem    
  Nobel-winning economist calls Apple's business practices 'fraud'  
  HMRC wins Project Sussex tax avoidance case 
   1MDB: The inside story of the world's biggest financial scam 
  Amazon boss becomes world's third richest man 
 Financial Transaction Tax on Wall Street Trading Could Raise More Than $105 Billion Annually  

  Christian Candy denies gifts to brother were part of tax evasion plot  
  Inheritance tax: how the wealthy reduce it  
  US Expands Real Estate Money Laundering Reporting  
 Australian tax accountant wins tropical island resort  

Daily Caller, IRS Launches Investigation Of Clinton Foundation:
IRS Commissioner John Koskinen referred congressional charges of corrupt Clinton Foundation “pay-to-play” activities to his tax agency’s exempt operations office for investigation, The Daily Caller News Foundation has learned.

Western Europe Has World's Highest Property Taxes

Following up on my previous post, IRS Sues Facebook For Billions In Undervalued IP Assets In 2010 Irish Transfers: Bloomberg, Facebook Fails to Show Up for Seventh Tax Summons From IRS:
Facebook officials failed to show up after getting seven summonses from the Internal Revenue Service demanding internal corporate records on one of its offshore tax strategies, according to an IRS court filing.

Ireland Revenue probes 40 'tax-neutral' companies for suspected abuse

Ireland: Reports of vulture funds using tax loophole probed

Galya Savir (Michigan), Tax Infinity & Beyond: Commercial activities in space are going to expand thanks to new game-changing technologies being developed by Space Entrepreneurs. 

National Audit Office Report: HM Revenue & Customs (HMRC) 2015-16 Accounts

UK Labour proposes scrapping £1bn tax relief for innovation 

Fortune 500 Companies with the Most Cash in Offshore Tax Havens

US Liberal Group Wants SEC to Boost Disclosure Rules on Tax Avoidance

Don't believe Wall Street's scare stories about a financial transactions tax

HMRC contact centres urged to adopt callback services

Indonesia repatriates $30m through tax amnesty programme

Industrialist goes on trial for tax avoidance in France

 Another Offshore Account Indictment