Wednesday, May 07, 2008

International News Links

We have decided occasionally to publish lists of relevant news stories and links in these blogs. You can see a longer list here. Further stories are available from Offshore Watch.

Financial secrecy in America, abetting war criminals
May 5 (TJN) - US Senators Carl Levin and Barack Obama (Democrats) and Senator Norm Coleman (Republican) have introduced a bill "to protect the United States from U.S. corporations being misused to commit terrorism, money laundering, tax evasion, or other misconduct." Who has the U.S., through its secrecy and other tax haven activities, been inviting to bank in the U.S.? Here's a new one: Charles Taylor, the brutal former president of Liberia.
Also see:

Dutch Bank Funded U.S. Tax SheltersMay 2 (WSJ) - A low-profile Dutch bank has played a major role helping U.S. companies save huge sums on their taxes. Rabobank Group's involvement in U.S. corporate tax-paring has gone on largely outside public view. But its role has been extensive, involving billions of dollars in financing for transactions that generated tax benefits for the likes of General Electric Co., Merck & Co. and others.

Tax co-operation should be the longer-term objective
May 2 (FT letter) - Sir, The chancellor’s proposed tax forum (report, April 30) seems to be based on the idea that international competition, rather than co-operation, should be the keynote of corporate tax policy in an increasingly globalised world. But it is not practical to suggest that any one country’s corporate tax regime should be dominated by the need to keep its rules and tax rates more favourable to multinational companies than its competitors.

Taxation and Governance in Africa
April (AEI) - Taxation is an underrated tool in the effort to build more capable and responsive states. Democracies are built not only on periodic elections but also on a social contract based on bargaining over the collection and spending of public revenue. A discussion of foreign aid and taxation, and more.

Feeble government lets the superclass soar over the rest of us
May 4 (Observer) – By Will Hutton - There has not been a gap between the rich and poor on the current scale ever in history. It is unstable. Sooner or later, there will be popular outrage and a political response. For the moment, though, it seems that a spell has been cast over the political process, at least in Britain.

Tax details of Italy's rich disclosed
May 2 (Accountancy Age) - Italy's glitterati were left reeling this week when the Italian National Tax Office published their income and tax details online in a freely accessible and alphabetically-arranged list.

Tesco and tax: a complex web of companies, trusts and partnerships
May 3 (Guardian) - In February the Guardian published two articles about Tesco's tax practices. At the heart of the story was Tesco's stated desire to realise up to £5bn by cashing in on the rise in value of its massive UK property portfolio through sale and leaseback schemes - while maintaining control of the stores.

May 4 (Tax Research) RTE in Ireland has reported: Accounts for Microsoft Ireland Research, an Irish subsidiary of the global software giant, show that the company paid just €460,000 in tax, on profits of more than €1.2 billion last year. You couldn’t make it up. That’s 0.04% tax.

May 5 (Tax Research) - Another disaster for British foreign policy, British tax haven policy and even surer indication that many tax havens will cease to operate sometime soon because local people no longer want them and the UK will not longer be able to suffer the embarrassment of running them. It’s time for the UK to face this fact, now, and deal with it.

The UK Is Responsible For Its Tax Havens
May 1 (Tax Research) The House of Commons’ Public Accounts Committee (PAC) has reported on the UK’s Crown Protectorates a day after the Treasury Select Committee announced it was to look at tax havens. The PAC report is damning.

A TV investigation into the tax haven world, quoting TJN widely. In French.

Banks' link to tax haven
May 1 (The Australian) BANKING giants ANZ and Westpac issued almost all the top-secret tax-haven bank accounts at the centre of an alleged $100 million tax-evasion scheme.

When business calls, the clunking fist turns into a wee tim'rous beastie
May 2 (Guardian) - UK's John McFall yesterday announced that not only would his committee investigate the 10p tax disaster, but it would conduct its own review of UK tax havens. One of those who will give evidence to the select committee - and who should certainly have been on Darling's advisory forum, is Richard Murphy, of the Tax Justice Network.

EUROPE: Tax Havens Cheating the Poor
Apr 30 (IPS) - Tax havens in Europe are depriving poor countries of more money than they receive in development aid, it has been alleged. Quoting TJN's John Christensen.

UK’s Darling sets up new forum to look at taxApril 29 (FT) – UK Chancellor announced the formation of a working group to look at the tax system. The new group, which will include industry representatives, will “discuss ways in which the tax system can provide the long-term certainty multinational companies need, considering the competitiveness and other challenges facing both businesses and government.”

UK MPs to investigate tax havens
April 30 – Accountancy Age - The UK Treasury Select Committee has announced an inquiry into tax havens. The committee wants to look at 'offshore financial centres.' Among the issues it says it wants to look at are whether the centres 'threaten financial stability'; their transparency for UK tax purposes and their impact on the UK tax take among other things.

IMF Working Paper: Housing Finance and Mortgage-Backed Securities in Mexico
This paper reviews the Mexican experience with the securitization of residential mortgages. Banking secrecy reform enabled banking institutions to share information on customer credit operations, providing a strong impetus to the credit reporting industry. A law in 2002 resulted in more than 1,000 institutions feeding the databases of Buró de Crédito with positive and negative information on more than 64 million individual accounts and 4 million company accounts. This allows them to better differentiate borrower risk and expand credit.

The Clinton-McCain Gas Tax Proposal: Get Half a Tank Free This Summer
And more from Citizens for Tax Justice, including:
John McCain: If the Issue Is Health Care, the Answer Is... Tax Cuts!
State Budget Math: Economic Downturns + Enormous Tax Cuts = Painful Spending Cuts
Lawmaker Says His Deciding Vote to Abolish Income Tax Was Just Being "Cutesy"
Florida: Good Thing We Don't Have to Do This Again for Twenty Years

Shell firms shielded US contractor from taxes
May 4 – Boston Globe - In March 2005, one of the Pentagon's most trusted contractors - Virginia-based MPRI, founded by retired senior military leaders - won a $400 million contract to train police in Iraq and other hotspots. Two months later, MPRI set up a company in Bermuda to which it subcontracted much of the work. It was not the first time MPRI executives had used a shell company in an offshore tax haven to perform government-funded work.

Bank secrecy rules to be reviewed
May 3 – Jamaica Gleaner - THE GOVERNMENT has signalled that the rules governing secrecy, as it relates to banker/client relationships, will be reviewed when a joint select committee of Parliament examines the proposed whistle-blower legislation.


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