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GUARDIAN Sun, 22 Jan 2012 00:07:46 GMT
Proposals for reform hint at more openness, but the nation is unlikely to abandon its tax haven status entirely
Even for the 51 weeks a year when Davos is just another ski resort, Switzerland is renowned as a haven for multimillionaires in search of a quiet life – and a minimal tax bill. Lewis Hamilton and Phil Collins are among the Brits who have chosen to flee to the Alpine state to avoid the scrutiny of the Revenue.
But tax havens, where few questions are asked about residents' financial affairs, have come under increasing international pressure to change their ways in recent years.
The resignation of Swiss central bank governor Philipp Hildebrand earlier this month, after his wealthy wife caused controversy by betting against the Swiss franc, showed that the country has become less tolerant of the idea that the financial affairs of the super-rich should be secret.
The UK and German treasuries have both recently signed agreements with the Swiss government under which their citizens will have to pay up for salting their money away in secretive accounts in Zurich or Geneva – though the European commission is currently challenging the deals, which have not yet been signed into law.
Criticism of the Swiss authorities' approach intensified after a celebrated case starting in 2010, in which a whistleblower at HSBC released the financial details of scores of the bank's private clients, allowing the French, German and UK authorities to pursue them for unpaid tax.
More recently, the Swiss government has proposed abolishing so-called "lump sum taxation", under which wealthy individuals can offer to pay a flat fee up front in exchange for avoiding any scrutiny of their financial affairs by the authorities.
Swiss finance minister Eveline Widmer-Schlumpf said last summer when the idea was announced that revenue could double, although she acknowledged that some taxpayers might decide to leave rather than submit to closer examination of their affairs. "We have to realistically reckon with people leaving, but we do not think it will be a huge number," she said. However, the plan has not yet come into force.
At the same time, a group of leftwing campaigners is promoting the idea of a referendum on imposing a federal inheritance tax for the first time, as well as a levy on financial gifts. The proposals are unlikely to be voted on until next year but could be enforced retrospectively to cover any gifts made from this month.
However, Richard Murphy of the Tax Justice Network said it would be a mistake to see these straws in the wind as evidence that Switzerland is shrugging off its secretive status. "It's clearly still a tax haven, and most wealthy people if they wanted to could still put their money there, no questions asked," he said.
Tax avoidance
Switzerland
Davos
Corporate governance
Europe
Heather Stewart
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WASHINGTONPOST Wed, 18 Jan 2012 08:01:19 EST
To be fair to Mitt Romney, it's not his fault that he pays a 15 percent tax rate. This isn't some complex, accountant-driven tax scam. First, it's the fault of President Bill Clinton and a Republican-led Congress who, in 1997, lowered the capital gains rate from 28 percent to 20 percent. Second, it's the fault of President George W. Bush and a Republican Congress, which lowered the rate to 15 percent in 2001. As far as we know -- and we haven't seen his full tax returns yet, so all this is provisional -- Romney is paying the tax rate that our duly elected representatives told him to pay. If we don't like the law, it's the law that needs to be changed. Read full article >>
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BOSTON Thu, 12 Jan 2012 03:15:20 GMT
Congress is damaging the Internal Revenue Service by shortchanging its budget, making it harder for the agency to help taxpayers, detect fraud and bolster revenue collection even as budget deficits surge, a government watchdog said yesterday. “The imbalance between its workload and its resources is becoming unmanageable,’’ Nina E. Olson, the national taxpayer advocate, wrote in her annual report on the IRS. Olson, an independent watchdog within the agency, wrote that agency computers set aside 1.1 million tax returns seeking refunds last year for examination for possible fraud, a 72 percent increase from 2010.
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GUARDIAN Tue, 10 Jan 2012 00:24:39 GMT
We were told the rich are always with us, but now the unthinkable is starting to be thought
Peter was intensely relaxed about the wealthy, Tony disavowed any wish to lighten big pay packets, and only last year George agitated to trim top tax. The plutocracy posed as creators rather than possessors of wealth, and the politicians were had. They said the rich are always with us, and – in a globalised world – needed new freedom to enrich themselves further. Well, what a difference a financial crisis makes. It's not three years since a Labour government ruled out a commission on high pay, but the malcontents at Compass continued to push until the Rowntree Charitable Trust funded an independent commission. A tenacious chair was found in Deborah Hargreaves, late of the Guardian, who duly reported last autumn. The parties are now scrambling to cherry-pick from her plans – from transparent pay to more representative remuneration committees. We must wait to see what actually happens, but at last the unthinkable is starting to be thought.
Executive pay and bonuses
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