Page 94 – Tax Justice Network

Illicit financial flows and human rights: attention grows with new report

We’ve just written about an important report by the CESR and Christian Aid on fiscal justice and human rights, as more evidence that the world is waking up to the crucial linkages between human rights and tax and offshore abuses. Now here’s another report, a policy brief from the Hague Institute for Global Justice entitled Curbing Illicit Financial Flows: The Post-2015 Agenda and International Human Rights Law. Continue reading “Illicit financial flows and human rights: attention grows with new report” →

Stiglitz: how to use tax to build an economy

Joseph_Stiglitz_Nobel_Prize_Laureate_at_Forum_Invest_FINANCE_2009

Joseph Stiglitz. Forum Invest, Creative Commons 3.0

Nobel Laureate Joseph Stiglitz has just published a White Paper with the Roosevelt Institute entitled Reforming Taxation to Promote Growth and Equity. It is a fascinating and clear piece of work, distilling a number of powerful tax principles – and it includes a section on formula apportionment (or unitary taxation).

We will highlight just a few things of note – most of which we’ve pointed out on several occasions, but are nice to see endorsed here: Continue reading “Stiglitz: how to use tax to build an economy” →

Quote of the day: fiduciary duties

From Adam Kanzer of Domini Social Investments, in an article regarding a recent Google shareholder vote seeking the adoption of a responsible code of conduct to guide the company’s global tax strategies:

“Imagine a legal obligation, based on principles of prudence and loyalty, that compels us to condone behavior that stifles innovation, destroys local and national economies, and shifts heavy financial burdens to our own clients and beneficiaries.
Fortunately, this obligation to minimize tax payments does not exist.” Continue reading “Quote of the day: fiduciary duties” →

Private equity: harnessing secrecy to fleece investors and taxpayers

The widely-read U.S. financial blog Naked Capitalism is running a fascinating post about the private equity industry, which involves the release of a number of apparently sensitive documents. The article notes:

“For decades, private equity (PE) firms have asserted that limited partnership agreements (LPAs), the contracts between themselves and investors, should be treated in their entirety as trade secrets, and therefore not subject to disclosure under Freedom of Information Act laws in any jurisdiction. Continue reading “Private equity: harnessing secrecy to fleece investors and taxpayers” →

Two lieutenants of leading EU finance critic defect to ‘the enemy’

That’s from an article in the Financial Times, which begins like this:

“The UK’s Investment Management Association has poached two key lieutenants of Sven Giegold, the German Green MEP who has been a scourge of the fund industry in recent years.”

This is of interest to us for two reasons: first that it (anecdotally) serves as a reminder of one aspect of the ‘capture’ of policymaking by the highly-remunerated financial sector; and second, that Giegold was one of the founders of TJN, and had been a doughty supporter of tax justice over many years. We wish him well in his continued endeavours.

Endnote: the FT’s headline writer calls Giegold a “market critic” – which is wholly inaccurate. Giegold has been a fierce critic of the corruption of markets.

That’s a very different thing.

The Piketty controversy and the offshore wealth problem

As many readers will already know, there’s a big controversy going on regarding Prof. Thomas Piketty’s world-famous economics work Capital in the 21st Century, with the Financial Times alleging that he faces a ‘Reinhardt-Rogoff moment’ because of data problems. Piketty responds that he’s been transparent about everything and the FT is being ‘ridiculous’ to suggest that it undermines his central conclusions that inequality, particularly at the top of the income scales, has been rising. Continue reading “The Piketty controversy and the offshore wealth problem” →

Credit Suisse: most of its victims haven’t seen any justice at all

There’s been a lot of debate about the $2.6 billion (possibly tax-deductible, despite claims to the contrary) fine that Credit Suisse has paid for its systematic policies of attacking the U.S. tax system and fostering and, by implication, encouraging, criminal behaviour by thousands of U.S. citizens.

We and many others have decried the resolution as deeply inadequate, given the scale of what Credit Suisse had been involved in. Denial of its U.S. banking licence – with all the implications that might have on its correspondent banking operations and so on – would have been apt, as would have happened if some of its executives had gone to jail.

But Koen Roovers of the Financial Transparency Coalition (FTC) reminds us, via email:

“Is it so hard to imagine that the bank was involved in this practice in other foreign markets? Continue reading “Credit Suisse: most of its victims haven’t seen any justice at all” →

The May 2014 Taxcast

In the Tax Justice Network’s May 2014 Taxcast: the Taxcast looks at privatisation and tax: what happens when public assets or services get into private hands? Also: Google’s challenged on its tax affairs by its own shareholders; will Congress block the US administration’s decision to agree to the G20’s global transparency standard? And whatever happened to the UK government’s ‘leadership’ on public registers of the real owners of companies now it turns out it’ll ‘encourage’ but not ‘force’ its overseas territories & Crown dependencies to sign up to the initiative?

Produced by @Naomi_Fowler and featuring economist James Henry, John Christensen of the Tax Justice Network, Colombian Union leader Gerardo Santibanez, journalist and writer George Turner, Donald Cohen of www.inthepublicinterest.org Educationalist Daniel Weil, and philosopher Michael J Sandel.

The download link is available here.

Taxcast home site: www.tackletaxhavens.com/taxcast

Tax chart of the day: US taxes

We’ve just blogged Citizens for Tax Justice’s latest report on U.S. Fortune 500 companies and their unpaid taxes. Now, from the Financial Times, a chart. Continue reading “Tax chart of the day: US taxes” →

Switzerland fights to curb scope of global transparency moves (updated)

Switzerland: clinging to old secrecy practices as the world moves forwards

Cross-posted with the Escape from Europe blog:

The Swiss Federal Council on Wednesday issued a statement making it all too clear what it thinks “the new global standard for the automatic exchange of information in tax matters” should look like. This concerns the OECD’s ongoing project to create a new framework for international financial transparency, which we’ve written about before: while we found shortcomings, we welcomed the project overall. The OECD is expected to finalise its global standard in June.

The Swiss position is a direct threat to global moves on transparency. A private tax adviser tells TJN:

“My view is that they are trying to wriggle out of it.”

Continue reading “Switzerland fights to curb scope of global transparency moves (updated)” →

CTJ: U.S. Fortune 500 companies likely escaping $550bn in tax

From Citizens for Tax Justice:

“American Fortune 500 corporations are likely saving about $550 billion by holding nearly $2 trillion of “permanently reinvested” profits offshore. Twenty-eight of these corporations reveal that they have paid an income tax rate of 10 percent or less to the governments of the countries where these profits are officially held, indicating that most of these profits are likely in offshore tax havens.” Continue reading “CTJ: U.S. Fortune 500 companies likely escaping $550bn in tax” →

Tax haven operators hope to persuade China to block global transparency moves

From the BVI Beacon in the British Virgin Islands, a Special Report entitled Under pressure, BVI fears big impact on financial services. The BVI, and particularly a number of mostly white, male expatriate workers, have made a living out of secrecy. They don’t like all this transparency stuff that we and our colleagues are pushing for, and which is now becoming more widely accepted by world leaders. The report notes:

“During a public consultation that ended in March, stakeholders were asked if the territory should create a central registry of beneficial ownership and if it should be public.
For many industry practitioners here, the answer, at least to the second question, is a resounding “no.” Continue reading “Tax haven operators hope to persuade China to block global transparency moves” →

It seems that Credit Suisse’s fine may be tax-deductible after all

“Are we Swiss all criminals?” The poster asks. No. But many Swiss bankers are.

We have written recently about how Credit Suisse’s $2.6 billion fine for its history of abusing the U.S. tax system and facilitating high crimes may seem like a lot of money, but it could — and should — have been a lot worse. Why did no bankers go to jail? And, perhaps more importantly, why does it still have its U.S. banking licence?

But there has been a palliative, it seems: according to reports:

“As part of its plea agreement, Credit Suisse agrees to forego any kind of tax deduction for any of the payments it makes.”

Which is fine and dandy — good, in fact, as far as it goes. But now, from the Swiss newspaper Le Matin: Continue reading “It seems that Credit Suisse’s fine may be tax-deductible after all” →

Why did the Australian government keep this tax symposium secret? (updated)

Mathias Cormann, Australian Finance Minister

May 26: Updated with new details from the Sydney Morning Herald

This concerns a meeting in Tokyo, hosted by the Australian Treasury, to discuss the G20’s tax agenda. This involves not just the OECD’s “BEPS” project to reform the international rules for taxing multinational corporations, but also the rules and guidelines on information exchange and transparency, as well as on tax matters facing developing countries.

All this has come to the fore in the wake of widespread public pressure to curb secrecy and corporate and other tax abuses, and in general terms we welcome it. Continue reading “Why did the Australian government keep this tax symposium secret? (updated)” →

Human Rights Policy Brief: a Post-2015 Fiscal Revolution

The New York-based Center for Economic and Social Research (CESR) and Christian Aid have just published an important new paper entitled A Post-2015 Fiscal Revolution: Human Rights Policy Brief. It is a most useful contribution to the fast-growing community of researchers and research on the crucial topic of tax justice and human rights. (In fact, the paper focuses on fiscal justice and human rights – which means tax plus spending.)

Continue reading “Human Rights Policy Brief: a Post-2015 Fiscal Revolution” →

How Putin’s comrades washed their money in Switzerland and the UK

[vc_row][vc_column width=”1/1″][vc_column_text]Via a tweet from Ben Judah:[/vc_column_text][vc_raw_js]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[/vc_raw_js][vc_column_text]This is about an excellent Reuters investigation into a Russian state scheme to buy expensive medical equipment – and send money to Swiss bank accounts. It is worth reading in its entirety, but we will hone in on this bit: Continue reading “How Putin’s comrades washed their money in Switzerland and the UK” →

How ‘competitiveness’ became one of the great unquestioned virtues of contemporary culture

This headline is drawn from an important article at the London School of Economics website by Will Davies, Senior Lecturer at Goldsmiths, University of London. We’ve not had contact with Davies, but it seems we have been thinking along similar lines. Continue reading “How ‘competitiveness’ became one of the great unquestioned virtues of contemporary culture” →

Credit Suisse and tax evasion: a fine is fine, but why no jail time?

[vc_row][vc_column width=”1/2″][vc_column_text]From Democracy Now!

“European banking giant Credit Suisse has pleaded guilty to helping American clients avoid paying taxes by concealing assets in illegal, undeclared bank accounts — becoming the largest bank to plead guilty to a criminal charge in 20 years. As part of the plea deal, Credit Suisse will pay about $2.6 billion in penalties and hire an independent monitor. But the bank will not be required to turn over the names of the Americans who used the bank to evade taxes. In addition, no senior Credit Suisse executives will face jail time, and the bank will be allowed to continue operating in the United States.

Indeed. Why was its bank licence not revoked? That would have been a sign of seriousness. See the transcript here.[/vc_column_text][/vc_column][vc_column width=”1/2″][vc_column_text][/vc_column_text][vc_column_text]”They’re yodeling through the Alps over the light touch. We’re talking about a Swiss bank that has been doing this kind of activity for decades.”
– James Henry[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column width=”1/1″][vc_column_text]

According to The New York Times, the Securities and Exchange Commission voted last week to grant Credit Suisse a temporary exemption from a federal law that requires a bank to hand over its investment-adviser license in the event of a guilty plea. We speak to James Henry, former chief economist at McKinsey & Co., now a senior adviser to the Tax Justice Network and senior fellow at the Vale Columbia Center on Sustainable International Investment.”

The Netherlands tax haven: infographic

From SOMO, and a page entitled The Dark Side of the Netherlands. Click to enlarge.

Please share.

Netherlands Tax Haven Infographic

Hedge funds versus tax collectors: quote of the day

From U.S. tax professor Victor Fleischer, in an article looking at how hedge funds and their managers use Bermuda reinsurance vehicles for their tax shenanigans:

“The chess match between tax collectors and fund managers will continue.
The top 25 hedge fund managers have one advantage, though. They made more than five times the income of all the federal, state and local tax examiners, collectors and revenue agents in the United States, combined. Continue reading “Hedge funds versus tax collectors: quote of the day” →

Report: Switzerland’s role in Shell’s tax avoidance

From SOMO in the Netherlands:

“There is not one drop of oil coming out of the Swiss mountains, but still Royal Dutch Shell has eight subsidiaries in Switzerland. Between 2001 and 2005 the Dutch-British oil multinational set up a range of subsidiaries in the country, although these entities are not involved in any productive activities, finds a new report released today. The Centre for Research on Multinational Companies (SOMO) and Friends of the Earth Europe report concludes that Shell uses Switzerland mainly for ‘tax planning purposes’. Continue reading “Report: Switzerland’s role in Shell’s tax avoidance” →

The UK’s shadow economy: £40 billion lost to treasury

The Financial Times reports this morning:

The Treasury is losing more than £40bn of tax a year because of evasion and the hidden economy, nearly four times official estimates, according to a tax campaigner. Richard Murphy of Tax Research UK, a research group, called for tougher checks on hundreds of thousands of “shadow” companies that did not file tax returns, which he estimated resulted in a £12bn loss of tax revenue.

The report, co-published by TJN, is also covered by the Guardian, the Mirror and the Times. The full report is here.

Murphy has issued a press release: Continue reading “The UK’s shadow economy: £40 billion lost to treasury” →

Thank you!