I'd love more background on why the foreign banks cooperated.
Presumably, the larger ones have US arms to do things like trade on Wall Street. Maybe the American government threatened to penalize Swiss institutions through their US subsidiaries if they didn't cooperate, but I imagine that many of the smaller banks (and the state-owned ones) don't have interests in the US. How can they be penalized for violating the law of a jurisdiction that's literally on the other side of the world?
Transactions in USD must be cleared in NYC; the US' position is that banks which don't play ball re: money laundering lose access to the US financial system.
It happens exactly as you suspect, by arm twisting in secret.
I can tell you in some detail how Canada did some of its own arm twisting against the United States!
Some years ago, Charles Schwab & Company (a major US brokerage) had to close all the accounts of Canadian customers who had accounts in the US.
Charles Schwab & Company is a wholly-owned subsidiary of the Schwab Corporation that trades on the NYSE. Schwab Canada was a subsidiary of the Schwab Corporation. There was no other relation between Schwab Canada and Charles Schwab & Company.
When the Schwab Corporation sold off Schwab Canada (their Canadian broker/dealer) to a Canadian company, the Canadian government said that Schwab's US operations had these these choices:
(a) get a Canadian license; Canadian laws says that they cannot solicit Canadian business unless they open a branch in Canada, or
(b) transfer all Canadian clients to their Canadian broker/dealer before they sold it, or
(c) face a $2,000,000 fine for doing business without a license; the Canadian government's threatened fine is against the parent company (the Schwab Corporation)
Notice that the Canadian government feels free to punish and give orders to the entirely US-based company (Charles Schwab & Company) and to the parent company (Schwab Corporation) because the Canadian government doesn't want it citizens to maintain accounts in the US.
Schwab kept holding off for 2 years on doing anything, but finally the Canadian government threatened to start fining them.
There were 1400 Canadian customers who had their US-based accounts closed. Merrill Lynch (an even bigger US brokerage) had a lot more US-based Canadian accounts than Schwab, and the same thing happened to them as well.
So even though foreign countries should have no jurisdiction over what a country does internally, they actually do because deals get blocked and secret pressure is applied.
It's mentioned by another commenter, but being cut off from the US financial system, even for banks with no presence here, is a blow that many institutions cannot recover from. The dollar is the world's reserve currency and it allows the US to exert enormous influence.
"Tax Cheating" is evidently another way of saying "sovereign state". The Swiss can do whatever they want. We don't tax the world. Sadly they capitulated in what was naked Imperial aggression by a foreign power.
The US is free to prosecute US tax dodgers...in the US.
What a silly response. Of course the Swiss can do whatever they want. The IRS doesn't have any interest in taxing Swiss people living in Switzerland, earning Swiss francs working in Switzerland.
But people and organizations doing business in the United States, and all US citizens, have legal US tax obligations. If you don't like it, feel free to renounce your citizenship and avoid doing business in any US markets.
Legality aside, how do US citizens (loosely defined as people who were born in the US decades ago) who do not live or work in the US have any moral obligation to pay taxes to the US?
When they travel, they may take advantage of visa-free entry into many countries, negotiated through treaties with the US. If they get into legal trouble abroad, they enjoy consular protection from the US State Department. They enjoy the right to vote in US elections, and the (at least theoretical) right to move to the US should they fancy it.
Actually the process is not so straightforward. They still tax you for years afterwards, for one thing. I've also heard that getting the US gov't to actually accept one's passport resignation can challenging, especially if they think you owe them money.
> lump sum taxes on things like pensions and retirements
You mean if they've been living and working for years in the US, and taking advantage of US tax-advantaged retirement accounts?
Now we're talking about a different person than the parent commenter: "(loosely defined as people who were born in the US decades ago) who do not live or work in the US "
> rules apply to you if any of the following statements apply.
> * Your average annual net income tax for the 5 years ending before the date of expatriation or termination of residency is more than a specified amount that is adjusted for inflation ($147,000 for 2011, $151,000 for 2012, $155,000 for 2013 and $157,000 for 2014).
> * Your net worth is $2 million or more on the date of your expatriation or termination of residency.
> * You fail to certify on Form 8854 that you have complied with all U.S. federal tax obligations for the 5 years preceding the date of your expatriation or termination of residency.
This applies to a tiny subset of people who are either a) Extremely wealthy, or b) Already tax deadbeats.
Laws and morality are not aligned quite often. Especially in this case. They have a legal obligation. And I haven't heard of a case of anyone being forgiven their taxes because they said they don't have a moral obligation to pay.
Now let's play devil's advocate and see how you could benefit from those taxes even if you are away? -- Well you could return and then start taking advantage of services, goods, infrastructure, security, protection etc. Something could happen to you and you could request assistance or evacuation. You can use your passport to travel to many countries without a visa. You could vote. But yeah that's all I can think of. Not very convincing. Certainly does not seem worth it.
The main problem they are trying to solve I imagine is people who become rich, and then all of the sudden scurry to a private islands and stop paying taxes.
> The main problem they are trying to solve I imagine is people who become rich, and then all of the sudden scurry to a private islands and stop paying taxes.
It's not terribly uncommon for people to renounce their US citizenship to prevent this. If you left the US decades ago, you don't to have to pay, because you'll have that option instead.
That said, I don't think US tax policy makes much sense. I know of no other country that tries to tax the foreign income of citizens living in foreign countries.
Canada makes it pretty difficult as well. Canadians living abroad have to sever all ties with Canada completely (no address, no bank account, no property... not sure about drivers license, you may give that up as well:) in order not to pay Canadian taxes.
Looking into it, there are 3 things that would always make you a resident of Canada: a home, a spouse or dependants in Canada. Personal property, bank accounts, employment with a Canadian company, a drivers license, a passport, and other such things are also considered and enough of them together might make you a resident.
The law is the law, US persons owe money wether they are living in US or not.
> The Swiss can do whatever they want.
They can, they are very sovereign, and they chose to play along with American IRS. Probably a rational choice vis-a-vis the pressure and downsides they could receive if they don't.
Some banks chose to not cater to and not accept US persons at all.
> The Swiss can do whatever they want ... Sadly they capitulated in what was naked Imperial aggression by a foreign power.
So you're unwilling to assign a moral value to Swiss actions, but are willing to assign moral values to the actions of others? Yes, the Swiss can run their country however they want - but so can everyone else, even if it includes not being friendly to the Swiss.
This is just the 'consequence-free speech' argument scaled up to national size.
Tax Evasion is a Global Problem - every country from UK to Russia to my own country of Bangladesh have rich people hiding their money in foreign countries.
I am happy that the US public is forcing their govt to look into it and hopefully a global system is set up to prevent tax evasion everywhere.
Interesting, unsure why you were downvoted here. I completely agree that tax evasion is a global problem. There's a fantasic book called "Treasure Islands"(http://treasureislands.org/) which goes into it in detail. Showing how multinationals and the very rich structure their affairs so as to avoid the bulk of taxation (while not actually living in these offshore jurisdictions)
Is it right? It's reasonably legal (the difference between evasion and avoidance is a very grey thing). According to the book linked above, we give less in aid than countries lose in not being able to tax effectively.
Not quite sure how you fix it, probably fewer laws and more transparency. But it'll be quite the fight, there are more than a few $$'s at stake.
Some Swiss banks loaded funds onto untraceable debit cards. At another, clients who wanted to transfer cash used code phrases such as “Can you download some tunes for us?” One bank allowed a client to convert Swiss francs into gold, which was then stored in a relative’s safe-deposit box.
Dozens of Swiss banks have been spilling their secrets this year as to how they encouraged U.S. clients to hide money abroad, part of a Justice Department program that lets them avoid prosecution. It is part of a broader U.S. crackdown on undeclared offshore accounts that has ensnared big Swiss banks such as UBS Group AG, but has received scant attention because it mostly involves little-known firms and relatively small fines.
A Wall Street Journal analysis of Justice Department documents from more than 40 settlements with these banks provides a rare window into foreign firms’ tax-haven techniques and their myriad methods of keeping clients’ accounts under wraps. The offenders range from international banks to small-town mortgage lenders, which together helped secrete more than 10,000 U.S-related accounts holding more than $10 billion, according to the analysis.
“Helping Americans conceal assets from the IRS was a big business for many sizes and types of firms in Switzerland, and now we’re seeing how extensive it was,” said Jeffrey Neiman, who led the Justice investigation of UBS in 2009 that pierced the veil of Swiss-bank secrecy. He is now at law firm Marcus Neiman & Rashbaum LLP in Fort Lauderdale, Fla.
The firms that have admitted to the misconduct have paid a total of more than $360 million to resolve the cases and avoid criminal charges. Lawyers for U.S. account holders and Swiss banks estimate that 40 other firms in this program are in talks with the Justice Department.
ENLARGE
CHRIS PHILPOT FOR THE WALL STREET JOURNAL
“Banks large and small are naming individuals and firms that helped U.S. taxpayers hide foreign accounts and evade taxes,” said acting Assistant Attorney General Caroline Ciraolo. “It is now clear that asset-management firms, investment-advisory groups, insurance companies and corporate service providers—not just banks—facilitated this criminal conduct.”
More than 54,000 U.S. taxpayers with undeclared accounts have paid more than $8 billion to the Internal Revenue Service to resolve their cases and avoid criminal prosecution.
The following methods used by the Swiss firms were laid out in detail in signed statements from settlement documents and disclose misconduct dating back to 2008, although some wrongdoing had occurred for decades.
Most firms said they provided clients with numbered or code-name accounts with identities known only to a few employees. The banks also held mail destined for the U.S., in part to calm clients who were afraid the U.S. government might go through it. One client of Bank Sparhafen Zurich AG told a manager the bank’s hold-mail fee was “cheap insurance against having my dealings with you come to the attention of the government revenue authorities.”
Many banks also helped U.S. taxpayers further cover up their ownership of accounts in sham trusts and foundations in tax havens such as Liechtenstein, the British Virgin Islands and Panama.
ENLARGE
CHRIS PHILPOT FOR THE WALL STREET JOURNAL
To give U.S. clients ready access to funds, some banks issued prepaid debit cards that were hard to trace. BSI SA of Lugano, which is one of the largest private banks in Switzerland, said some clients in need of cash sent emails with coded phrases like “gas tank still running on empty.”
Firms also accommodated clients who were fearful of U.S. money-laundering rules that require scrutiny of transfers above $10,000. St. Galler Kantonalbank AG, a regional bank controlled by the Swiss canton of St. Gallen, said it allowed nine U.S. customers to make a total of $3 million of withdrawals in amounts less than $10,000.
The bank in 2009 allowed one client who closed an account holding 1 million francs, whi...
My solution is always to Google the full article title then click through from there. Quick and easy way around most (I've yet to encounter a site that tries to block this) news sites paywall.
I find the response to these articles often very baffling. Everyone seems to want to nail these banksters for dodging taxes using clever loopholes. Then, they rail against government incompetence and praise people who work within a narrow framework while getting results ("hackers"). Obviously, this is a generalization and not every person thinks this way, but I often find this sort of response on places like reddit and even here to some extent.
If the Federal Gov't wants tax money it better start making a strong case with some serious value propositions. Realize, that post-civil war the Federal Income Tax was allowed to expire, even for funding the war it was only 10%. It had been ruled unconstitutional.[0]People don't want to give the government money at a corporate or personal level. And if they would stop buying warehouses of hammers and dumping it into the middleeast funding helicopters that will never fly and powerplants that don't work, maybe people would at lease be neutral, instead of downright hostile, about the issues of taxes.
My point, which I didn't explicitly state, is that maybe instead of demonizing the rich for tax evasion we should be doing more to help the poor and middle class achieve these same ends. Obviously, building a strong economy and job creation are much more important, but lowering taxes and allocating the money the government does have, should be important goals going forward.
At times like this it is worth remembering that "wealth" accounts, the ones the banksters are "tax optimizing" for their clients, start at $5000 balance or so and the average is in fact no higher than $45000.
I don't know, but I do think that the people these accounts belong to could easily in fact be the "top-50%" and not so much the "top-1%". Hence the baffling response.
I wonder when a guy who robs a liquor store can get the same deal as these white-collar tax cheats: steal $500, and avoid criminal charges in exchange for paying $250 restitution.
More like: robber has $1000 to his name, robs the liquor store for $500; avoids criminal charges by paying $750 restitution. (The article mentioned half of the account balance, not half of the amount of taxes owed.)
But the real difference is that while robbing a liquor store is universally viewed as unethical; that isn't the case with tax evasion. Many people (including, ironically, the founders of the USA, who seceded from the British over taxation) believe that taxes are unethical, and using every loophole and trick in the book to minimize taxes is both ethical and smart.
I totally agree. Just to add, playing the game well and keeping your own money is borderline unethical/illegal depending on where you land on the issue but it is your money. Threatening someone else at gunpoint, and taking their money is quite different than simply keeping your own and not paying a fair share.
Do you think that a person or company retaining the money they earned over the fiscal year, or not paying as much as they should to their gov't, can aptly be compared to armed theft of someone-else property? I mean, if we are making analogies about armed theft, like one good one is taxes.
This is a stupid analogy. People dodging taxes rob from the commons, essentially. If you're not satisfied with what the government does with your taxes and you live in a democratic society, get out and vote, a benefit you enjoy due to your taxes, as well as things like security, a justice system and (depending on your country) an efficient healthcare and welfare system, all paid for by your taxes. Just like a normal government should also spend a significant amount of your money on supporting the less well-off in the society.
Yeah mate, makes sense. I'll just get out and vote. It isn't like there are limited choices, entrenched political ideologies, a significant amount of friction, or a massive power distance relationship between constituents and representatives. America is a Democratish society and there is a pretty high level of dilution between my/societies views and laws.
I vote(just kidding, I don't actually vote but let's accept the hypothetical) for a representative for congress. That gives me the option to have 4 people representing me in ALL of congress, assuming that the people I wanted to win progressed AND that they represent my views broadly enough.
There are 535 people in congress, if we assume my 2 house reps and my 2 senators map my views at a 1:1 ratio (they don't, at all, nor do nearly anyone's in America) then, if you generously round up from .0074, my views are indirectly represented for me and are around 1%.
Luckily, we live in a world where there are lots of great choices for Senators, Representatives and Presedential canidates and absolutely no outside interests interloping on the process. So I vote often. Every year, I don't turn up to the polls and vote to not participate. My single vote not being casts detracts a tiny bit of legitimacy from a system I want to fail, and I can hope for a better future.[0]
[0]Someone on HN articulated this really well, and I would love to find the quote from him/her, but it perfectly summed up my own thoughts.
For what it's worth to the people saying "we (as in the US or the international community more generally) have no interest in this and shouldn't trample on sovereign nations," I respect your opinion and your disdain for heavyhanded, imperialistic behavior, but don't ignore the evils that these banks perpetuate. They are opportunistic and protect and facilitate some of the worst people on earth, including arms traffickers and dictators who commit atrocities against their own people. Maybe exerting pressure against these banks isn't the right solution, but I have no sympathy for the sort of people who helped the Sudanese commit genocide, and anything that works against them I'm inclined to support.
Except - they also serve as a safehaven for wealth created in countries where its very likely to be confiscated by totalitarian and unstable governments. Think Nazi Germany, Rhodesia/Zimbabwe and unfortunately, possibly, hopefully unlikely - China.
Most of the wealth "created" in totalitarian states is in fact extracted by kleptocratic rulers. Ferdinand Marcos in the Philippines, numerous African dictators, Vladimir Putin, current the 3rd richest person in the world.
If you want to create exceptions for financial refugees, that's well and good. But global protection for every drug lord, terrorist, and petty dictator ain't the right way to do it.
Even closer in the neighborhood, most of the Greek kleptocrats have their money in Swiss banks too. Some of them are now being prosecuted, with information that only came to light because an employee of HSBC took some account lists home (in violation of Swiss law). The French police later found these in a raid, and turned them over in part to the Greek police [1]. I wouldn't be surprised if Swiss banks are also handling the money from organized crime in Bulgaria and Romania.
I think eventually, like the US has, the EU will succeed in pressuring Switzerland to cooperate more with European police investigations and turn over this kind of information. Despite not being an EU member, Switzerland is too economically entangled in EU treaties like the common market, to entirely ignore what the EU thinks, at least in cases where the EU actually agrees on what it thinks and is willing to make an issue out of it.
For those looking for more background (and open access) to offshore banking and tax shelters, I highly recommend the ICIJ's long-running series of investigative reports on sheltered wealth: http://www.icij.org/offshore
57 comments
[ 2.9 ms ] story [ 120 ms ] threadPresumably, the larger ones have US arms to do things like trade on Wall Street. Maybe the American government threatened to penalize Swiss institutions through their US subsidiaries if they didn't cooperate, but I imagine that many of the smaller banks (and the state-owned ones) don't have interests in the US. How can they be penalized for violating the law of a jurisdiction that's literally on the other side of the world?
https://en.wikipedia.org/wiki/Foreign_Account_Tax_Compliance...
What would be interessting would be to know how some banks could accept these consequences and still survive.
I can tell you in some detail how Canada did some of its own arm twisting against the United States!
Some years ago, Charles Schwab & Company (a major US brokerage) had to close all the accounts of Canadian customers who had accounts in the US.
Charles Schwab & Company is a wholly-owned subsidiary of the Schwab Corporation that trades on the NYSE. Schwab Canada was a subsidiary of the Schwab Corporation. There was no other relation between Schwab Canada and Charles Schwab & Company.
When the Schwab Corporation sold off Schwab Canada (their Canadian broker/dealer) to a Canadian company, the Canadian government said that Schwab's US operations had these these choices:
(a) get a Canadian license; Canadian laws says that they cannot solicit Canadian business unless they open a branch in Canada, or
(b) transfer all Canadian clients to their Canadian broker/dealer before they sold it, or
(c) face a $2,000,000 fine for doing business without a license; the Canadian government's threatened fine is against the parent company (the Schwab Corporation)
Notice that the Canadian government feels free to punish and give orders to the entirely US-based company (Charles Schwab & Company) and to the parent company (Schwab Corporation) because the Canadian government doesn't want it citizens to maintain accounts in the US.
Schwab kept holding off for 2 years on doing anything, but finally the Canadian government threatened to start fining them.
There were 1400 Canadian customers who had their US-based accounts closed. Merrill Lynch (an even bigger US brokerage) had a lot more US-based Canadian accounts than Schwab, and the same thing happened to them as well.
So even though foreign countries should have no jurisdiction over what a country does internally, they actually do because deals get blocked and secret pressure is applied.
Countries need to have a certain number of TIEAs to not be considered a tax haven and be white listed.
The US is free to prosecute US tax dodgers...in the US.
But people and organizations doing business in the United States, and all US citizens, have legal US tax obligations. If you don't like it, feel free to renounce your citizenship and avoid doing business in any US markets.
If they really aren't interested, it's a pretty straightforward process to walk into the nearest embassy and opt-out: http://travel.state.gov/content/travel/en/legal-consideratio...
It's expensive to renounce US citizenship.
You mean if they've been living and working for years in the US, and taking advantage of US tax-advantaged retirement accounts?
Now we're talking about a different person than the parent commenter: "(loosely defined as people who were born in the US decades ago) who do not live or work in the US "
https://www.irs.gov/Individuals/International-Taxpayers/Expa...
> * Your average annual net income tax for the 5 years ending before the date of expatriation or termination of residency is more than a specified amount that is adjusted for inflation ($147,000 for 2011, $151,000 for 2012, $155,000 for 2013 and $157,000 for 2014).
> * Your net worth is $2 million or more on the date of your expatriation or termination of residency.
> * You fail to certify on Form 8854 that you have complied with all U.S. federal tax obligations for the 5 years preceding the date of your expatriation or termination of residency.
This applies to a tiny subset of people who are either a) Extremely wealthy, or b) Already tax deadbeats.
"If they get into legal trouble abroad, they may enjoy consular protection from the US State Dept". FTFY.
Now let's play devil's advocate and see how you could benefit from those taxes even if you are away? -- Well you could return and then start taking advantage of services, goods, infrastructure, security, protection etc. Something could happen to you and you could request assistance or evacuation. You can use your passport to travel to many countries without a visa. You could vote. But yeah that's all I can think of. Not very convincing. Certainly does not seem worth it.
The main problem they are trying to solve I imagine is people who become rich, and then all of the sudden scurry to a private islands and stop paying taxes.
Basically, this guy: http://www.foxnews.com/tech/2012/05/11/facebook-co-founder-r...
That said, I don't think US tax policy makes much sense. I know of no other country that tries to tax the foreign income of citizens living in foreign countries.
http://www.cra-arc.gc.ca/tx/tchncl/ncmtx/fls/s5/f1/s5-f1-c1-...
The law is the law, US persons owe money wether they are living in US or not.
> The Swiss can do whatever they want.
They can, they are very sovereign, and they chose to play along with American IRS. Probably a rational choice vis-a-vis the pressure and downsides they could receive if they don't.
Some banks chose to not cater to and not accept US persons at all.
So you're unwilling to assign a moral value to Swiss actions, but are willing to assign moral values to the actions of others? Yes, the Swiss can run their country however they want - but so can everyone else, even if it includes not being friendly to the Swiss.
This is just the 'consequence-free speech' argument scaled up to national size.
I am happy that the US public is forcing their govt to look into it and hopefully a global system is set up to prevent tax evasion everywhere.
Is it right? It's reasonably legal (the difference between evasion and avoidance is a very grey thing). According to the book linked above, we give less in aid than countries lose in not being able to tax effectively.
Not quite sure how you fix it, probably fewer laws and more transparency. But it'll be quite the fight, there are more than a few $$'s at stake.
Some Swiss banks loaded funds onto untraceable debit cards. At another, clients who wanted to transfer cash used code phrases such as “Can you download some tunes for us?” One bank allowed a client to convert Swiss francs into gold, which was then stored in a relative’s safe-deposit box.
Dozens of Swiss banks have been spilling their secrets this year as to how they encouraged U.S. clients to hide money abroad, part of a Justice Department program that lets them avoid prosecution. It is part of a broader U.S. crackdown on undeclared offshore accounts that has ensnared big Swiss banks such as UBS Group AG, but has received scant attention because it mostly involves little-known firms and relatively small fines.
A Wall Street Journal analysis of Justice Department documents from more than 40 settlements with these banks provides a rare window into foreign firms’ tax-haven techniques and their myriad methods of keeping clients’ accounts under wraps. The offenders range from international banks to small-town mortgage lenders, which together helped secrete more than 10,000 U.S-related accounts holding more than $10 billion, according to the analysis.
“Helping Americans conceal assets from the IRS was a big business for many sizes and types of firms in Switzerland, and now we’re seeing how extensive it was,” said Jeffrey Neiman, who led the Justice investigation of UBS in 2009 that pierced the veil of Swiss-bank secrecy. He is now at law firm Marcus Neiman & Rashbaum LLP in Fort Lauderdale, Fla.
The firms that have admitted to the misconduct have paid a total of more than $360 million to resolve the cases and avoid criminal charges. Lawyers for U.S. account holders and Swiss banks estimate that 40 other firms in this program are in talks with the Justice Department.
ENLARGE CHRIS PHILPOT FOR THE WALL STREET JOURNAL “Banks large and small are naming individuals and firms that helped U.S. taxpayers hide foreign accounts and evade taxes,” said acting Assistant Attorney General Caroline Ciraolo. “It is now clear that asset-management firms, investment-advisory groups, insurance companies and corporate service providers—not just banks—facilitated this criminal conduct.”
More than 54,000 U.S. taxpayers with undeclared accounts have paid more than $8 billion to the Internal Revenue Service to resolve their cases and avoid criminal prosecution.
The following methods used by the Swiss firms were laid out in detail in signed statements from settlement documents and disclose misconduct dating back to 2008, although some wrongdoing had occurred for decades.
Most firms said they provided clients with numbered or code-name accounts with identities known only to a few employees. The banks also held mail destined for the U.S., in part to calm clients who were afraid the U.S. government might go through it. One client of Bank Sparhafen Zurich AG told a manager the bank’s hold-mail fee was “cheap insurance against having my dealings with you come to the attention of the government revenue authorities.”
Many banks also helped U.S. taxpayers further cover up their ownership of accounts in sham trusts and foundations in tax havens such as Liechtenstein, the British Virgin Islands and Panama.
ENLARGE CHRIS PHILPOT FOR THE WALL STREET JOURNAL To give U.S. clients ready access to funds, some banks issued prepaid debit cards that were hard to trace. BSI SA of Lugano, which is one of the largest private banks in Switzerland, said some clients in need of cash sent emails with coded phrases like “gas tank still running on empty.”
Firms also accommodated clients who were fearful of U.S. money-laundering rules that require scrutiny of transfers above $10,000. St. Galler Kantonalbank AG, a regional bank controlled by the Swiss canton of St. Gallen, said it allowed nine U.S. customers to make a total of $3 million of withdrawals in amounts less than $10,000.
The bank in 2009 allowed one client who closed an account holding 1 million francs, whi...
If the Federal Gov't wants tax money it better start making a strong case with some serious value propositions. Realize, that post-civil war the Federal Income Tax was allowed to expire, even for funding the war it was only 10%. It had been ruled unconstitutional.[0]People don't want to give the government money at a corporate or personal level. And if they would stop buying warehouses of hammers and dumping it into the middleeast funding helicopters that will never fly and powerplants that don't work, maybe people would at lease be neutral, instead of downright hostile, about the issues of taxes.
[0]http://www.eoearth.org/view/article/153529/
I don't know, but I do think that the people these accounts belong to could easily in fact be the "top-50%" and not so much the "top-1%". Hence the baffling response.
But the real difference is that while robbing a liquor store is universally viewed as unethical; that isn't the case with tax evasion. Many people (including, ironically, the founders of the USA, who seceded from the British over taxation) believe that taxes are unethical, and using every loophole and trick in the book to minimize taxes is both ethical and smart.
I vote(just kidding, I don't actually vote but let's accept the hypothetical) for a representative for congress. That gives me the option to have 4 people representing me in ALL of congress, assuming that the people I wanted to win progressed AND that they represent my views broadly enough.
There are 535 people in congress, if we assume my 2 house reps and my 2 senators map my views at a 1:1 ratio (they don't, at all, nor do nearly anyone's in America) then, if you generously round up from .0074, my views are indirectly represented for me and are around 1%.
Luckily, we live in a world where there are lots of great choices for Senators, Representatives and Presedential canidates and absolutely no outside interests interloping on the process. So I vote often. Every year, I don't turn up to the polls and vote to not participate. My single vote not being casts detracts a tiny bit of legitimacy from a system I want to fail, and I can hope for a better future.[0]
[0]Someone on HN articulated this really well, and I would love to find the quote from him/her, but it perfectly summed up my own thoughts.
http://www.bloombergview.com/articles/2015-10-20/shh-credit-...
If you want to create exceptions for financial refugees, that's well and good. But global protection for every drug lord, terrorist, and petty dictator ain't the right way to do it.
I think eventually, like the US has, the EU will succeed in pressuring Switzerland to cooperate more with European police investigations and turn over this kind of information. Despite not being an EU member, Switzerland is too economically entangled in EU treaties like the common market, to entirely ignore what the EU thinks, at least in cases where the EU actually agrees on what it thinks and is willing to make an issue out of it.
[1] https://en.wikipedia.org/wiki/Lagarde_list