http://opinion.financialpost.com/2013/06/14/many-rings-to-the-global-circus/

The G8 will learn about a template devised by the Organization for Economic Co-Operation and Development to globalize tax collection. This will include measures such as transparency, sanctions and sharing agreements between governments.

An estimated $32-trillion is hidden offshore, or two U.S.-sized economies, socked away in numbered or secret accounts in a variety of dirty money capitals. And Canada is being accused of reluctance when it comes to getting information from its banks then sharing it with other governments.

According to a story in The Post this week, tax watchdog groups claim that Canada is resisting Cameron’s efforts to force governments to exchange tax information about known cheats. He also wants governments to collect information from financial institutions about foreign-sourced income and give that information to the foreign countries where the income was made so they know about it and can tax it.

Currently, Canadian laws are lax. Offshore assets must be reported, but the CRA doesn’t pursue leads as aggressively as do the Europeans or Americans. There has been some movement, but Cameron wants more. Under pressure, Ottawa set up a “swat” team to pursue offshore evaders, now requires reporting of offshore transactions of more than $10,000, offers modest whistleblower rewards and just announced that resource companies must report all payments to foreign governments. Resistance is due to the fact that the Canadian banks are a powerful lobby here, but Canadians who pay taxes deserve better management of tax collection.

I personally would like nothing more than to see a TUC general strike.

http://www.taxresearch.org.uk/Blog/2013/06/14/what-we-want-from-the-g8-the-tuc-view/

This is the result of the USA’s new commitment to automatic information exchange with countries all over the world that hold information on the foreign taxable income of US citizens. This commitment was embodied in US law in 2010 in what is called the Foreign Accounts Tax Compliance Act (FATCA). This becomes operational in 2014. This Act specifically only applies to US citizens. All the FATCA agreements made by the USA are bilateral – which means that they are strictly between the USA and other individual countries. But to make FATCA work, any country that wants to hold deposits from US citizens needs systems to provide this kind of information. Once in place, these can be used by other countries to demand the same automatic exchange of information to track the overseas income of their tax residents. Full transparency has become a realistic possibility for the first time. Almost certainly as a direct result of FATCA, together with strong campaigning against tax abuse by unions and others, UK ministers have changed their position on what is called automatic information exchange (AIE). AIE happens when income earned in one country by a person who is resident in another country is automatically reported to the country where the person lives, whether the person involved likes it or not. This can be done bilaterally – that is between two countries – or multilaterally, which happens when many countries sign up to the same system. European countries are already used to the second system as a dilute form of this has been in operation in most EU states since 2005.

http://www.guardian.co.uk/world/2013/jun/13/g8-david-cameron-objectives

The prime minister was meeting continued resistance from his Canadian counterpart, Stephen Harper, over critical plans to require countries to reveal the true beneficial owners of shell companies and trusts. The measure is vital to combatting money laundering, fighting tax evasion and turning tax information exchange into something meaningful.

Cameron laid on the diplomatic red carpet for Harper, giving him the rare honour of speaking to both houses of parliament, a visit to the Queen and a lengthy bilateral meeting at Downing Street. But Harper is worried about exposing private Canadian tax affairs and fears complications arising from Canada‘s federal structure.

In a crucial advance for Cameron, a US Treasury spokesman said: “We view the G8 as an important opportunity to make progress on cracking down on criminal and illicit actors who use shell companies to hide their true identities”.

The US Treasury said “Increased transparency including the availability of beneficial information to law enforcement is an essential element of the US broader effort to enhance financial transparency which also includes strengthening customer due dilligence requirements for US financial institutions with respect to beneficial ownership of legal entity account holders”.

The remarks suggest that Barack Obama is not going to support public registries of beneficial ownership, limiting access to tax authorities.

 
Add this item to the list of benefits/disadvantages of U.S. citizenship?

According to the former officials, U.S. cyberspies, most from military units who’ve received specialized training, sit at consoles running sophisticated hacking software, which funnels information stolen from computers around the world into a “fusion center,” where intelligence analysts try to make sense of it all. The NSA is prohibited by law from spying on people or entities within the U.S., including noncitizens, or on U.S. citizens abroad. According to one of the former officials, the amount of data the unit harvests from overseas computer networks, or as it travels across the Internet, has grown to an astonishing 2 petabytes an hour—that’s nearly 2.1 million gigabytes, the equivalent of hundreds of millions of pages of text.

Emphasis added.

Source: How the U.S. Government Hacks the World / Bloomberg BusinessWeek (May 27-June 22, 2013) 36

Full article at http://www.businessweek.com/articles/2013-05-23/how-the-u-dot-s-dot-government-hacks-the-world