Senate Panama Papers: A World-Spanning Financial Scandal

Makes sense. I'm mainly talking bout people who are actually earning a certain amount (and by that, I mean not loosing it in bad investments) and who are declaring a lesser amount legtimatley (usually through companies, trusts, etc). I have ancedotal stores of this happening which are certainly reliable however I don't know the details since I'm not in the industry. Throw me a bone Ender.

 

Well Philosopher I'm trying to show you that the situation is extremely complicated and oversimplifications about "the rich do X" or "the poor do Y" serve nobody.

See, it's a wonderful misdirection because as a general rule the have-nots will always harbour resentment towards the haves, and one could argue with modest success that Marx was right in the analysis about history as class struggle. But by wasting time directing anger at the wrong places we're never actually getting to a point where meaningful reform is possible, likely or even achievable.

I'm presenting you with pretty common scenarios in income tax not to "a ha!" you, but to show you that the issue is very complicated and needs to be treated as such.

 

http://www.theguardian.com/business/2016/apr/11/panama-papers-imf-christine-lagarde-global-tax

dp4m

 

I'm in favor, and certainly something better than FATCA, but good luck getting everyone to agree.

 

Global tax will not happen.

 

Shane, you need to read the articles and not just mouse over the HTML link, gleaning info from there.

Oxfam's push was to have a UN body have oversight over tax loopholes, to increase transparency.

Not to have a global tax rate. Just to stop tax avoidance.

 

Makes as much sense as the outrage and theories to date.

 

I don't believe I ever said that the situation with tax wasn't complicated - I fully acknowledge it is. What I am trying to say that there are still loopholes that the rich (primarily) utilised to reduce their income tax legitimately which I consider to be unfair. I fully acknowledge this is not all rich, or even the majority, or even that some reduction in tax isn't fair. However it does happen and people do have a right to not be happy about it, and to suggest that people should just ignore it because 'it's complicated and nuanced' seems like a completely irrelevant point.

 

except that is not what's being said.

Right now people are annoyed about things they shouldn't be because they don't understand them, like Mr Cameron's shares.

This is a distraction, and although they lack the integrity to admit their outrage is predicated on his party affiliation it's transparently the case.

That's all.

 

I acknowledged that they weren't making sense. I'm saying that the base outrage is from the very real reality that some people (and some companies) don't pay their fair tax. They are being unfairly reactionary to Mr Cameron. I'm saying that there is a reason to be outraged however, like Occupy Wall Street, and its misdirected towards the first thing they see.

 

Absolutely. But right now Google and Apple are still getting a free pass in the court of public opinion despite being the most blatant offenders.

 

But the tax avoiding companies of Apple and Google are hip and cool and they provide me with overpriced but quality products.

The tax avoiding rich guy probably thinks that there should be a flat tax and doesn't have any respect for his overworked and underpaid workers.

 

As usual, I appreciate the news sources that you guys share. Thanks a million for helping inform us.

 

I did read the article and LeGarde is correct in suggesting states will not surrender their power to tax, closing loopholes included. That's a part of taxation. Creating an Interpol for national tax cheats….I don't see a unified front here in the U.S. to support creation of a international regime for compliance. Some democrats have publicly decried tax cheats like Apple but there is no consensus in Congress to take it to an international level. I don't see it happening right now.

 

I'm gonna go get the papers, get the papers.

 

On this topic, since I see populists on social media getting upset over their own proletarian ignorance, it seems...

http://www.pwc.com.au/federal-budget-2016/global-tax.html
https://www.ato.gov.au/General/New-...come-tax-for-businesses/Diverted-Profits-Tax/

We are, I believe, the second or at least one of the very, very few countries to implement a tax on diverted profits.

Diverted profits are essentially your Apple and Google revenue streams which are assigned back to entities - usually through complex licensing arrangements, rental fees etc - to related bodies corporate of the parent and domestic entity, domiciled in low-tax jurisdictions. Or, in simple terms - when Google and Apple treat their profit as being taxable somewhere that is favourably low on tax.

So even though they benefit from the services and infrastructure provided by the state, these companies - American in origin, or American in philosophy because who else would find the notion of contributing via tax so repugnant as to require avoidance? - don't pay any domestic taxes, and it's not illegal hence it's not punished.

By identifying and taxing (which will be challenging, for sure) diverted profits at 40% - note, the company tax rate is being progressively lowered from 30 to 25% over the next few years, making the practice of diversion less profitable - we start challenging the practice where it hurts.

I hope that we see more of this kind of behaviour from other Western states.

 

What's funny is... the US does this on people, but not corporations (as far as I can tell).

Though we'll be starting it on imported services, was my understanding for the Trump regime!

 

Yeah you're right. FATCA has established a framework for this, so presumably and of course notwithstanding that MNCs own most of congress, you could start to do this in the US too.

Though to be fair, dp4m, we're evil bankers so of course we'd... want to... see tax paid properly...

Wocky will be confused.

 

My understanding is Trump's going to want to essentially VAT it up; on every import (goods and services) so we'll see how that goes. Screws consumers of goods (will just be passed to the customers), but not sure how offshoring non-physical services will be anything other than a loss (but still net-gain assuming the offshored resources are less salary than US, plus VAT) to corporations.

 

So Trump is going to cock it up, because not paying tax he's basically unfamiliar with how the whole thing works?

 

Yes, generally, but I've seen fairly compelling evidence thus far that he's essentially doing very well with "financial diplomacy" so far, mostly because people are terrified of him -- which doesn't make it any less-bad for poor people, some middle class people, brown people, gay people, etc.

We'll see what happens if the other countries don't live up to their promises however.

 

So the Panama Papers has actually brought down a Prime Minister:

http://www.bbc.com/news/world-asia-40750671

In a 5-0 verdict, the Supreme Court of Pakistan ruled that PM Nawaz Sharif was unfit to hold office due to corruption allegations brought by the Panama Papers. He has thus resigned this morning.