Bloomberg is reporting today that the Senate Permanent Subcommittee on Investigations will be holding a hearing on a crackdown on offshore tax evasion. According to Sen.Carl Levin, offshore tax avoidance costs more than $100 billion a year. The hearing will focus on the status of ongoing investigations into Swiss banks and their US clients which include Credit Suisse Group AG and 14 other banks.
Since 2009, over 70 taxpayers and nearly three dozen bankers, lawyers and advisors have been charged with cheating the IRS through hidden accounts. Through the OVDP and OVDI programs, more than 43,000 Americans have avoided jail time and have paid $6 billion in penalties, fines and back taxes. Many leads from these participants have resulted in the building of criminal cases that previously, would have avoided detection due to Swiss privacy laws. Lawyers indicate that these leads are generating examination of tax havens outside of Switzerland.
Lawrence Horn, a tax attorney at Sills Cummis & Gross in Newark, New Jersey said “If I were Senator Levin, I’d ask the Justice Department, ‘You did this program with the Swiss and 106 banks signed up for non-prosecution, so will you take that prototype to other countries with a history of unreported bank accounts, such as Israel, India, Singapore and Hong Kong?”
The schedule for CSpan is not yet up for February 26. If you’ve got the February blues, maybe you can cheer yourself up watching Uncle Carl in action!
Offshore Tax Evasion: The Effort to Collect Unpaid Taxes on Billions in Hidden Offshore Accounts
Dirksen Senate Office Building
February 26. 2014
09:30AM – 05:13PM
Why stop now when things appear to be going so well, Uncle Carl?
…..According to Sen.Carl Levin, offshore tax avoidance costs more than $100 billion a year…….
this number is totally unrealistic , a pipe dream ! How did he or others come up with this number ?
I have not seen anywhere any credible calculations . What is Levin including in offshore tax evasion these days ….. GE,GOOG,AAPL etc or just you and me ?
Jack Townsend again brings up again an old favorite of his (from taxlitigator) . As usually he fails to set the record straight :
http://www.federaltaxcrimes.blogspot.ch/2014/02/toscher-article-on-update-on-offshore.html
…..While there have been criticisms of the OVDI programs, both in the terms of the way they were administered and the ‘‘one size fits all’’ penalty approach, it is fair to say that from a tax enforcement and compliance perspective, it has been a great success. The OVDI programs have brought more than 43,000 U.S. taxpayers back into U.S. tax compliance and are credited with the collection of tax, interest and penalties in excess of $5 billion.1 The level of voluntary disclosures and increased offshore tax compliance is unprecedented. …….
1. If I remember correctly than so far only approx. $150mio have been attributed to tax revenues…. the rest was all fines (interest, penalties etc.).
2. Levine speaks of $6 billion – Tauscher in excess of $5 billion…..are people getting desperate for attention here ?
3. I estimate that for 2013 still only approx. 1mio FBARs have been filed….. > 7mio expats but wow 43,000 USPs have become compliant …….. by any standard this cannot be called a success.
4. still the IRS does not understand that they need to create another broader “noisy“ option besides SFCP.
Detroit is bankrupt and Carl Lenin needs a scapegoat.
I have a real concern about the United Kingdom and Canada being the next “Switzerland”, just because of the information released by the GAO on the 2009 offshore voluntary disclosure program. Helpfully, the letter to Levin makes it clear that only 4% of the program participants were from outside the United States. Unhelpfully, however, while 42% of the foreign accounts disclosed in the 2009 OVDP were in Switzerland, the next two locations listed were the United Kingdom (8%) and Canada (4%), followed by France, Israel and Germany (also at 4%). I wouldn’t put it past Sen. Levin to conclude that the countries at the top of the list are therefore “tax havens” for rich US tax evaders, however unrealistic that is.
IRS is America’s feared and failing agency
As demands set to rise, flaws evident……………
http://www.bostonglobe.com/news/nation/2014/02/17/internal-revenue-service-institution-crisis-but-congress-fails-fix-many-problems/DxEQr3H6nEQndmbpHUtl0O/story.html
@Seat, do demagogues have to prove their claims. I think not.
@Seat
Levin is definitely interested in corporate tax avoidance. For example, his legislation includes provisions to prevent corporations from playing games moving intellectual property licensing around, which is not something that overseas individuals do. My concern is that there is a nasty tendency for laws to target corporate abuses, get applied to individuals and then the corporations fight for a get out clause to preserve American competitiveness (deferred taxation and passive foreign investment are two examples where this has happened over the years)..
Having said that, corporations don’t always get their way: Credit Suisse was a bit contributor to Rangel and fat lot of good it did them.
SFCP = Streamlined filing compliance procedures? (not the Society for the Furtherance of Critical Philosophy, although having a critical philosophy is essential for figuring out what is really going on in tax policy). Good point, though about noisy options.
The Townsend article omits some key points on the Curran case that it should have mentioned: her now deceased husband had opened the Swiss bank accounts and she had come forward voluntarily but had gotten caught out because her lawyers caused delays.. Would throwing a 79-year-old woman in prison for trying to clear up a tax mess her husband had largely created really have encouraged other people in a similar position to come forward (or would it have just cost the taxpayer money?)
I don’t think that the government cares too much about whether it is tax or penalties that generate the income, although it should.
FBAR compliance among expat is low, but it seems that Townsend is entirely focused on U.S. residents who have tax accounts abroad. As for the 43,000, it somewhat depends how much they have abroad
@ Petros , yes you are right but it is my duty to make it public as much as possible who is a demagogue and expose bad statistics for what they are – a lie .
Offshore Tax Evasion Crackdown to Be Focus of Senate Hearing
…..Chairman Carl Levin, a Michigan Democrat, estimates that offshore tax avoidance costs the U.S. Treasury more than $100 billion a year………..
http://www.accountingtoday.com/news/Offshore-Tax-Evasion-Crackdown-Focus-Senate-Hearing-69656-1.html
….again he gets quoted with this rediculous $ 100 billion p.a figure
Carl Levin is continuing to open up a can of worms. Carl be careful what you wish for, there may be unintended consequences to you jihad.
@Seat
Number that was plucked seems like a good sound bite cause people will say… omg… 100 billion… criminals I tell u… would u even pay attention if the number was like in the millions rather then billions.. The OVID program was a success in their eyes cause they *caught* them.. But the break down was small tax amount to HUGE penalities.. that is whispered rather said aloud. From what I am reading.. I would say majority were immigrants who may have become citizens or were still immigrants came into the program to right a wrong & ended up paying huge sums for something they didn’t know about. I guess when u immigrate to the US… they expect everyone not to have a life prior to the US. These rules where never explained & if residents try to clean it up…it ends up cleaning them out. Ex-Pats & immigrants have no say at all once theses reps find out u don’t have a vote… their logic… oh well… I have other things to worry about & they can’t keep me in office
“Senator Levin plays an important role because he brings the bully pulpit to this area and can pressure the government one way or another to make decisions on what it wants to do with these investigations.”
He can also choose to recognize that US persons living abroad are not the treasure trove the US is looking for – and make the appropriate adjustments.
Levin this porker has been on the public tit for ever.. Would love to see him as a defendent. In world court because of us overreach in other countries. Banking , business, monitoring. They should empty the 12 trillion of foreign Money out of Delaware corps ,Nevada entities etc, trusts..etc . This giant hypocrite is a tax haven SIx ..6 times larger than Switzerland. Come clean. .you bully
the only thing Levine and FATCA, DATCA and GATCA will create or already have started to create is a shadow economy involving goods and services which are paid for in cash, and therefore not declared for tax of > $100 Billion p.a . Can you imagine every year $1-200 Billion cash is disapearing worldwide in peoples closet…… with the current level of interest rates imo. a given.
Forget about taking your “programme” to Israel, India, Singapore or Hong Kong, Mr Levin, it appears that Canada is only beat out by the UK and Switzerland in the number of bank accounts US persons were hiding their money in in 2009.
https://taxconnections.com/taxblog/the-united-state-knows-where-offshore-tax-evaders-live-and-bank/#comment-1139
@bubblebustin,
Many Canadians with retirement and vacation homes in Florida, etc. as well as those working and studying in the US, will have both Canadian and US accounts.
Some went temporarily, married and stayed in the US. In many border communities, there are people whose lives are now in the US, but who left behind their RRSPs and other pre-existing accounts in Canada – ones which they either couldn’t dissolve (ex. RRSPs) or kept for convenience.
Now they won’t know what to do with them. I have met people in that circumstance. And there are others who have given their US resident family members signing authority or Power of Attorney for their bank accts for use in case of future emergencies (ex. arrangements for future disability and incapacity – as we are encouraged to do by our government out of prudence ). Now, those Canadians and those US residents don’t know what to do about these arrangement.
That would account for Canadian ‘foreign’ accts that may have been reported by US residents.
@badger
Yes, I see a lot if them originated in Florida. I would speculate that a number of Canada’s originate in the US sunbelt.
@bubblebustin
I am sure Uncle Carl will not give up even $0.01 as the minute the word “evasion” is used, his mind closes up.
@badger
Thanks for defining that. When I first saw it, I was puzzled.
@Robert
If I am to believe Wikipedia, that miserable old fossil has been a US senator since I was five, and I’m 40 now. Now, if he doesn’t fit the definition of a parasitic ‘career’ politician, I don’t know what does.
I just wonder why Carl and the off shore jihadists aren’t interested in where oh where is all that Sinaloa Cartel money being hidden and laundered? I’m sure it’s a fairly large amount and they haven’t even touched the tip of the iceberg finding where it might be laundered. I’m fairly sure if they would look inside the U.S. they’d find a lot of drug money. It is curious why they are so interested in those who live outside their borders with local banking accounts down the street from them but, aren’t really looking at American banks that hard.
Saw this on the Townsend site for Thursday, February 20, 2014 http://federaltaxcrimes.blogspot.ca/2014/02/gao-report-on-ovdp-2009-participation.html :
new tidbit from the GAO regarding the 2009 OVDP filings – as requested by Levin:
‘Subject: IRS’s Offshore Voluntary Disclosure Program: 2009
Participation by State and
Location of Foreign Bank Accounts’
January 6, 2014
http://www.gao.gov/assets/670/660005.pdf
How false is the basic premiss that there are ‘Unpaid Taxes on Billions in Hidden Offshore Accounts’”?
Posted on February 22, 2014
The hearings of the Senate on “Offshore Tax Evasion” of the “Billions in Hidden Offshore Accounts” make for good headlines, but no one seems to ask the critical questions of the basic premiss; Are there even “unpaid taxes on billions of hidden offshore accounts”?
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Where did this “billions” number come from?
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The government uses it in all sorts of materials, but no one has asked seriously its source.
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Will the hearings scheduled for February 26th, 2014, shed any light on this issue? The author is not optimistic it will.
http://tax-expatriation.com/2014/02/22/how-false-is-the-basic-premiss-that-there-are-unpaid-taxes-on-billions-in-hidden-offshore-accounts/
@badger
see US_ExpatCanada @US_ExpatCanada 13m
GAO report on 2009 #OVDP – Canada has 4% of the total # of #FBAR -low number reflective of fear or defiance?
http://tinyurl.com/m5evmpl
“According to Sen.Carl Levin, offshore tax avoidance costs more than $100 billion a year.”
There’s a new book “The Hidden Wealth of Nations” by an academic, Gabriel Zucman. He estimates that offshore tax evasion WORLDWIDE is $190 billion, of which $36 billion is by US taxpayers. Still a big number but only about 1/3 as much as claimed by the windbag, Sen. Levin. Also, about 4% of
the world’soffshore wealth is held by US citizens, which is roughly equal to the US’ share of world population:Correction: 4% of US citizens’ financial wealth is held offshore, not 4% of the world’s offshore wealth is held by Americans. BTW: Roughly 2.8% of Americans live “offshore”.
http://gabriel-zucman.eu/files/Zucman2015Slides.pdf
Slide 10