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The sheriff has spoken – and the Swiss must submit Financial Times (subscription)
Banks must accept that tax anonymity has had its day, says Philipp Hildebrand, former chairman of the governing board of the Swiss National Bank. See also: Swiss group moves to defend banking secrecy Business Times and What Price Swiss Tax Disclosure? Money Beat

Singapore’s Economy Might Collapse Due to New Bank Secrecy Rules Daily Press Dot Com

FATF visits Argentina to analyse "whitening" of undeclared money Clarín (In Spanish)
Hat tip: Jorge Gaggero

TJN is delighted to see that the Global Alliance for Tax Justice, a new campaigning body that complements TJN's mostly research-focused work, has a new website.

As the GATJ says:
"The Global Alliance for Tax Justice is the new campaigning body that has grown from roots in the research-strong Tax Justice Network. Founded in Lima, Peru in March 2013, GATJ’s initial coalition of 81 organisations is growing daily in every region of the world. We campaign and advocate for a world with fair and equitable tax systems that fund vital public services for all. Join us!

Please start by signing the pledge to help build the global campaign for tax justice. The list of signatories will be publicised in the third week of June, in connection with World Public Services Day (23 June), and shared with government leaders at upcoming G8 and G20 meetings." The fair share commitment

By Se-eun Jung,Executive Committee Member, People’s Solidarity for Participatory Democracy, Tax and Fiscal Reform Center
Read the full paper

EU commissioner: Offshore Leaks transformed tax politics EU Observer

Secret Files Expose Offshore’s Global Impact ICIJ

Son of Former Korean President Obtained Secret Offshore Company Amid Family’s Tax Evasion Scandal ICIJ

The global shell game trust.org

The UK Gold: watch the trailer for new documentary about tax avoidance - video The Guardian
See also: New film examines tax avoidance from UK to Cayman Cayman News Service

Original Publication Date: 

6 June, 2013

In a letter to WTO member governments, 188 organizations representing a wide diversity of civil society from developing and developed countries, called on government representatives in Geneva to “abandon the negotiations towards a binding agreement on Trade Facilitation in advance of the upcoming 9th Ministerial meeting of the World Trade Organization (WTO) in Bali." The letter was organized by the Our World Is Not for Sale (OWINFS) network. The letter states “binding rules on Trade Facilitation should not be promoted either inside the WTO through the proposed Trade Facilitation (TF) agreement, nor through other avenues such as bilateral or regional Free Trade Agreements (FTAs) or Economic Partnership Agreements (EPAs)."read more

The U.S. Foreign Account Tax Compliance Act (FATCA) is potentially the most powerful tool ever devised to stem cross-border tax evasion and to crack down on tax haven secrecy. Initially a U.S. initiative, it is now in the process of being adapted and multilateralised.

Now, of course, the Center for Freedom and Prosperity (CF&P) and a group of other ethically-challenged bodies in the United States, have decided that financial secrecy (subtext: for rich people only) and tax havens are very good things, and that Fatca needs to be repealed. They have put together a coalition called Repeal Fatca, which urges support for legislation introduced by libertarian Senator Rand Paul to repeal the majority of FATCA, leaving it an empty shell, and leaving the world once again wide open to abuse.

One of the expert witnesses at the Apple hearings in the U.S. Senate Permanent Subcommittee on Investigations in May 21 was J. Richard Harvey of Villanova University, a former top I.R.S. official, who said "I about fell off my chair" when Apple claimed not to be using tax gimmicks.

Now Harvey has published a short article, via Tax Notes, entitled Apple Hearing: Observations From an Expert Witness, which is free to download. In it, he makes some excellent observations. It opens with two related -- and very good -- questions:

• Should the U.S. and the rest of the world let Apple record two thirds of its global income in Ireland, with few employees and little or no real economic activity there?
• If not, where should the income be recorded?

More generally, should multinationals be allowed to record a disproportionate amount of their global income in tax havens, when that's not where their real economic activity is?

A report from Public Citizen in Washington, D.C.
"Legislation in Congress that would address tax loopholes, raise revenue, increase the fairness of the tax code and provide stability to the financial system are subject to lobbying efforts that are overwhelmingly lopsided in favor of industry interests."The report finds that 86 percent of those who have worked on these bills in the past two Congresses represent industry clients. But from our perspective, what's particularly interesting:

From Stefan Bach at the Deutsches Institut für Wirtschaftsforschung (DIW) in Berlin, a report entitled Has German Business Income Taxation Raised Too Little Revenue Over the Last Decades?

It's got plenty of detail in here, but we'll just highlight the top highlights:
"Our estimations suggest that the average implicit tax rate on German corporate income was around 21 percent since 2001. A detailed comparison of the corporate income measured in national accounts with the corporate tax base reported in the tax statistics reveals a considerable gap that amounts to 4 percent of GDP and more in 2004.
. . .
the gap still amounts to Euro 90 billion or 3.7 percent of GDP."The full report is here.

Update: official link discovered, here.

An important statement has emerged from a group of European countries, which appear to represent rapid progress towards the emergence of a truly global multilateral system of information exchange, based most heavily on the U.S.' Fatca legislation.

Here is the statement, which we can only find on unofficial websites for the moment but which we've received official confirmation of by email:
STATEMENT BY BELGIUM, THE CZECH REPUBLIC, DENMARK, FINLAND, FRANCE, GERMANY, IRELAND, ITALY, THE NETHERLANDS, POLAND, PORTUGAL, ROMANIA, SLOVAKIA, SLOVENIA, SPAIN, SWEDEN and THE UNITED KINGDOM
on the Pilot Multilateral Automatic Information Exchange Facility

ECOFIN, 14 May 2013Automatic information exchange between tax authorities is a powerful tool in tackling and deterring tax evasion.  Tax evasion is a global problem and we should look for a global solution, otherwise the problem is simply displaced.