bank secrets

[eppie]

In an initiative from pres. Obama, the US and the other countries in the G20 try to end the existence of bank secrets.
I don't know how far this will be going but this might be a big economic disaster for countries like Switzerland, as well as many of the small tax paradizes.

At the moment I don't know if these measures will help combatting the economic crisis but that was of course not the goal of this plan.

The only critiscism I have on this is 'why not earlier?'

(me and my complot theorie happy brain of course think that many people had big interests in these banking secrets......I mean, war on drugs and on terror but at the same time not minding that criminals and terrorist have secret bank accounts where they store their profits/money used for terrorism).

Any thoughts?

[Jester]

Any thoughts?

How are other countries going to pressure the Swiss to give up sovereignty over their own banks?

-Jester

[eppie]

How are other countries going to pressure the Swiss to give up sovereignty over their own banks?

-Jester

Well I am not sure about everything but 1: UBS pays 780 miljon dollars settlement to the american justice department and also delivers them a few100 names of american taxpayers that have accounts with them. (this was March 3rd) The swiss high court of justice found this settelement illegal however.

2. The reason for placing this new topic was that I read that many people in higher management of swiss banks are not allowed to fly to the US, France, Germany and the UK anymore by their employers for fear of being arrested.

Of course the US or any consortium of conutries (G20) can not make the rules in Switzerland, Monaco, Guernsey or whereever, but things seem to be happening.

My opinion is that this is a good thing, however I don't know how this story will end.

[kandrathe]

My opinion is that this is a good thing, however I don't know how this story will end.

The facade is that the US is doing this to reign in US citizens involved in illegal operations, like smuggling drugs, guns, etc. The truth is that the US wants the power to get their hands on the money, and I'm shocked that the OECD is a pawn in a US power grab.* This scheme is senseless, because just like anything else it will go underground. Those doing illegal things will form alternative forms of "banks" and put their assets in places where the US government cannot get their hands on it. Or, maybe misery loves company. We've done such a great job destroying US and other EU banks, so now we want to insure that all banks suffer.

Swiss Banks Call Tax Evader Label Unfair

"Mirabaud says before pointing fingers at others, the United States should put its own house in order. He says he believes there are more tax evaders with accounts in Florida and Delaware than in Switzerland."

Mirabaud is correct, and the names of tax evaders amongst the US political elite keep popping up in the news... Tom Daschle, Nancy Killefer, Tim Geithner, Ron Kirk, John McCain, Hilda Solis, Charlie Wrangel, Sarah Palin, Bill Richarson, and the list goes on and on. And, like the tip of the iceberg, these are the ones that became public.

* Maybe its not just the US? Maybe its the consortium of power interests that dominate the OECD.

[eppie]

This scheme is senseless, because just like anything else it will go underground.

Well no. The whole thing was that these banks are among others used to bring money from 'underground' to the normal economy. And about 'normal' tax evasion. I don't see these people put their money in a secret bank (so not one witrh secrets but completely secret).
It is however a scheme that will only target people how are doing wrong things, no innocents will be targeted (apart from swiss banks which will be struggling when this thing goes all the way).

Anyway, the fear of things going underground is not an argument not to do something.

Mirabaud is correct, and the names of tax evaders amongst the US political elite keep popping up in the news... Tom Daschle, Nancy Killefer, Tim Geithner, Ron Kirk, John McCain, Hilda Solis, Charlie Wrangel, Sarah Palin, Bill Richarson, and the list goes on and on. And, like the tip of the iceberg, these are the ones that became public.

Yes and many of these people will have their money in switzerland, caymans, virgin islands......so as I see it this Mirabaud gives the exact reason why the US wants to do this. This is a law not to target other countries it is a law to target your own citizins that do something that is not particularly patriotic

[--Pete]

Hi,

. . . no innocents will be targeted . . .

Are your rose colored glasses prescription, or did you buy them on eBay?

-Pete

[kandrathe]

Hi,
Are your rose colored glasses prescription, or did you buy them on eBay?

-Pete

... because our weapons of financial mass destruction are laser guided, right?

IRS tries to force UBS to reveal U.S. tax dodgers -- Bank kept 52,000 secret Swiss accounts for U.S. taxpayers, says IRS

Amongst the 52,000 US citizens will be the Hollywood elite, corporate officers, and politicians. The average John Q. Public "wage slave" does not need a secret UBS account, because the government keeps him relatively poor.

[kandrathe]

Anyway, the fear of things going underground is not an argument not to do something.

... says the man who trumpets his countries liberal stand on narcotics... We keep getting back to this concept of "Freedom" that seems to have been genetically ripped from you. People don't like the government to be involved in scrutinizing everything they do. The concept here is "assumption of innocence". Evidence of secret accounts does not amount to evidence of wrong doing, just as a private meeting of people in my home is not an anti-government conspiracy.

[--Pete]

Hi,

People don't like the government to be involved in scrutinizing everything they do.

There are some people, apparently, that don't realize "I'm from the government and I'm here to help you." is a sarcastic joke. :rolleyes:

--Pete

[eppie]

... says the man who trumpets his countries liberal stand on narcotics...

Yes but for a fact a liberal stance on narcotics does not cause more use of narcotics.
And my country is becoming more and more a christian conservative mess that I am not trumpeting anything anymore.:)


Making it illegal to put money away and don't pay taxes over will give the government of a state more income. And these things are in principle illegal....only hardly any actions were undertaken (indeed a bit like the dutch treatment of soft drugs:) ).
Contrary to people that smoke a joint for example (talking US now).
I think people that can afford a bank account in Switzerland are not the ones that have to worry about there freedom in general.

Anyway, a law is a law, and if something like this could lower taxes for normal people I think it is fine.

[kandrathe]

Yes but for a fact a liberal stance on narcotics does not cause more use of narcotics.
And my country is becoming more and more a christian conservative mess that I am not trumpeting anything anymore.:)
Making it illegal to put money away and don't pay taxes over will give the government of a state more income. And these things are in principle illegal....only hardly any actions were undertaken (indeed a bit like the dutch treatment of soft drugs:) ).
Contrary to people that smoke a joint for example (talking US now).
I think people that can afford a bank account in Switzerland are not the ones that have to worry about there freedom in general.

Anyway, a law is a law, and if something like this could lower taxes for normal people I think it is fine.

... or maybe "freedom" is that the government has no business knowing what you are smoking.
... and, maybe "freedom" is that the government has no business knowing every detail of your finances.

The problem that the US government has is that corporations no longer needke to be US based. Therefore, a US citizen can earn money from holdings outside the US, and if you have an account at UBS there is no way for the government to know if you pay your fair share of US taxes. In fact, it is quite unfair that the US government and many States demand taxes on foreign earned income. You see, you already have to pay the tax to the country where you earned the money, so for much of the EU it is quite steep. Then you have to declare that income as US income (if you have a home in the US), and you get taxed again. Then you declare it as income on your State income tax form and get taxed again.

The question is... What is the government's purpose? If it is "power over the people", then your attitudes are appropriate.

[--Pete]

Hi,

Small nit (isn't that redundant?):

Therefore, a US citizen can earn money from holdings outside the US, and if you have an account at UBS there is no way for the government to know if you pay <span style="color:red">what they mistakenly think is your fair share of US taxes.

Fixed;)

--Pete

[eppie]

The problem that the US government has is that corporations no longer needke to be US based.

Yes I know, other countries have that as well. Did you know the rollings stones are a dutch band, and that IKEA is dutch as well?



You never have to pay double income taxes, when you show you pay taxes in one country you don't have to pay them in the next. Actually often you can decide in which country to pay (if you have been getting income from 2 countries)
Anyway the taxes we are talking about here are property tax and not income tax.

Kandrathe, I know your point of view on paying taxes in general, but still look at it from another way. It is against the law not to pay taxes. And the small guy that does some work in black usually had a fair chance of being cought and fined, but up till now the big money has always been safe, I hope that that changes now.

[kandrathe]

You never have to pay double income taxes, when you show you pay taxes in one country you don't have to pay them in the next. Actually often you can decide in which country to pay (if you have been getting income from 2 countries)
Anyway the taxes we are talking about here are property tax and not income tax.

That may be true for you. But, my experience has been different. I always need to pay in the US, and most of the times in the host nation (which is why my rates double when I have to leave the country).

Kandrathe, I know your point of view on paying taxes in general, but still look at it from another way. It is against the law not to pay taxes. And the small guy that does some work in black usually had a fair chance of being caught and fined, but up till now the big money has always been safe, I hope that that changes now.

In the US, it is the classic case of the camel's nose in the tent. We started based on total freedom, with only excise taxes, tariffs, and customs duties. These taxes were fair and based upon user fees. The federal government relied upon donations from the States.

"When the Constitution was adopted in 1789, the Founding Fathers recognized that no government could function if it relied entirely on other governments for its resources, thus the Federal Government was granted the authority to raise taxes. The Constitution endowed the Congress with the power to "…lay and collect taxes, duties, imposts, and excises, pay the Debts and provide for the common Defense and general Welfare of the United States." Ever on guard against the power of the central government to eclipse that of the states, the collection of the taxes was left as the responsibility of the State governments."

But then during the Civil War the Income tax was sold as "no more than 3%". After the war, the income tax (amongst other war taxes) was repealed. However, with States rights being strongly eroded by the Civil War it was only a matter of time until the winds blew in a different direction, and in 1913 we had the passage of the 16th amendment.

"In October 1913, Congress passed a new income tax law with rates beginning at 1 percent and rising to 7 percent for taxpayers with income in excess of $500,000. Less than 1 percent of the population paid income tax at the time."

Then during the next century, we had the "Great Society", WWI, WWII, and perpetual war ever since. FDR proposed a 99.5 percent marginal rate on all incomes over $100,000. "Why not?" he said when an adviser questioned this tactic. Absolute power corrupts absolutely.

The federal government has grown into a sucking leech that siphons off (on average) 18% of personal income, heavily targeting the people who are the most productive. The bottom 4 deciles pay no taxes. Deciles 5-8 pay an average of 8% with 9 & 10 paying 18%, and 30% on average. The top 1% of taxpayers earn 22% of the income, yet pay 39% of the taxes. Now, we return to that theme I echo whenever I can... Only people with "Income" pay income taxes. The wealthy dabble in investing and owning appreciating assets, but it is only considered "income" when they are forced to sell something (which is seldom).

The tipping point has been reached here. The US government actively prevents people from becoming, or remaining wealthy. Let's look at this taxation another way. The bellicose and brutal US empire that stomps its boots all over the world is funded by these exorbitantly high taxes (and runaway borrowing). When the people in the US complain about the yoke, the government borrows more money (which we are expected to pay back) and tosses us some cake.

[Jester]

The tipping point has been reached here. The US government actively prevents people from becoming, or remaining wealthy.

How, then, is it possible that nearly half the world's billionaires are Americans? The world's wealthiest are, and for a century have been, American. You might not like how much the US government taxes income, but the notion that the government is "actively prevent[ing] people from becoming and remaining wealthy" is incorrect. The tax rates paid by wealthy Americans are lower than in nearly any comparable country.

Indeed, this concept is contradicted by your own previous argument, which you "echo whenever you can": how is the government preventing people from becoming and remaining wealthy, if the whole method by which this happens in a capitalist society (investment) is not subject to income taxation until the time of sale?

One might also point out that, whatever FDR's whims in private, the official rate never came close to 99.5% for over $100,000. I presume he was joking when he suggested it. The highest actual income tax ever passed was 79% for over $5 million, which applied to exactly one person: Rockefeller, who happens to be the inflation-adjusted richest man in history. Real income tax rates for almost everyone were very modest by modern standards.

-Jester

[weakwarrior]

How, then, is it possible that nearly half the world's billionaires are Americans? The world's wealthiest are, and for a century have been, American. You might not like how much the US government taxes income, but the notion that the government is "actively prevent[ing] people from becoming and remaining wealthy" is incorrect. The tax rates paid by wealthy Americans are lower than in nearly any comparable country.

Indeed, this concept is contradicted by your own previous argument, which you "echo whenever you can": how is the government preventing people from becoming and remaining wealthy, if the whole method by which this happens in a capitalist society (investment) is not subject to income taxation until the time of sale?

One might also point out that, whatever FDR's whims in private, the official rate never came close to 99.5% for over $100,000. I presume he was joking when he suggested it. The highest actual income tax ever passed was 79% for over $5 million, which applied to exactly one person: Rockefeller, who happens to be the inflation-adjusted richest man in history. Real income tax rates for almost everyone were very modest by modern standards.

-Jester

I´m not doubting the claim. Can you show me an article/webpage about both the 99.5% line and the tax which applied only to Rockefeller. My google-chi is weak.

[kandrathe]

How, then, is it possible that nearly half the world's billionaires are Americans? The world's wealthiest are, and for a century have been, American. You might not like how much the US government taxes income, but the notion that the government is "actively prevent[ing] people from becoming and remaining wealthy" is incorrect. The tax rates paid by wealthy Americans are lower than in nearly any comparable country.

But, they didn't earn it in wages. My point is that the money grab by the US federal government is against people who earn money through wages. If you earn a salary of $100,000, you would be lucky to be able to save/invest $1M over 20 years. With some incredible investments and luck, you might multiply that by 10. The fact remains that the government feeds itself on the backs of wage earners (78% of revenue).

Receipts for fiscal year 2007 were $2.4 trillion. FY2007 on-budget receipts were $1.7 trillion. FY2007 off-budget receipts were $608 billion. Off-budget receipts include Social Security and Medicare payroll taxes, as well as the net profit or loss of the U.S. Postal Service.

* $1.1 trillion - Individual income tax (43.9%)
* $869.6 billion - Social Security and other payroll taxes (34.7%)
* $370.2 billion - Corporate income tax (14.8%)
* $65.1 billion - Excise taxes (2.6%)
* $26.0 billion - Customs duties (1%)
* $26.0 billion - Estate and gift taxes (1%)
* $47.2 billion - Other (1.9%)

Source: preliminary FY2007 year-end estimate from the U.S. Treasury Dept.

Indeed, this concept is contradicted by your own previous argument, which you "echo whenever you can": how is the government preventing people from becoming and remaining wealthy, if the whole method by which this happens in a capitalist society (investment) is not subject to income taxation until the time of sale?

The government raises the top rates for people who earn over $164,550 per year. Within that wage, you pay approximately 50% for Federal, State, Local, SSI, etc to government. Now you have $82,275to pay for a mortgage, food, clothing, transportation, and other expenses. Then, with perhaps 5% of the $82,275, you might consider investment. Investing $4000 per year is not the road to Billions. Look up the average US rate for savings and investment, and you will see that it has been in the negative numbers for years. Lately, this has been caused by the ridiculously high prices of homes (which are now upside down for many, many people).

Regional differences are also not applied, so a person living in NYC earning $200K COL is usually double the person living in another city, and quadruple a person living in a rural area. The US governments threshold on "rich" keeps descending as well. In 2003, any income over $57,500 was enough to qualify for the top tax rate.

Just the US federal tax for single people in 2008,
# 10% on income between $0 and $8,025
# 15% on the income between $8,025 and $32,550; plus $802.50
# 25% on the income between $32,550 and $78,850; plus $4,481.25
# 28% on the income between $78,850 and $164,550; plus $16,056.25
# 33% on the income between $164,550 and $357,700; plus $40,052.25
# 35% on the income over $357,700; plus $103,791.75

One might also point out that, whatever FDR's whims in private, the official rate never came close to 99.5% for over $100,000. I presume he was joking when he suggested it. The highest actual income tax ever passed was 79% for over $5 million, which applied to exactly one person: Rockefeller, who happens to be the inflation-adjusted richest man in history. Real income tax rates for almost everyone were very modest by modern standards.

"By the end of the war the nature of the income tax had been fundamentally altered. Reductions in exemption levels meant that taxpayers with taxable incomes of only $500 faced a bottom tax rate of 23 percent, while taxpayers with incomes over $1 million faced a top rate of 94 percent. These tax changes increased federal receipts from $8.7 billion in 1941 to $45.2 billion in 1945. Even with an economy stimulated by war-time production, federal taxes as a share of GDP grew from 7.6 percent in 1941 to 20.4 percent in 1945."

http://www.treas.gov/education/fact-shee...stax.shtml

In my opinion, 94 percent is pretty close to 99.5 percent.

[Swiss Mercenary]

taxpayers with incomes over $1 million faced a top rate of 94 percent

... How much is that if it were adjusted for inflation? 20? 50 million? A year? You may find more sympathy for your cause if your heart wasn't bleeding for the sake of billionaires.

In my opinion, 94 percent is pretty close to 99.5 percent.

http://www.xkcd.com/558/

[kandrathe]

Yup, hey, why not just cap income then for everyone at say $50M per year? Anything more than that and it goes straight into the government coffers. Also... I wasn't plying for sympathy for billionaires. I was pointing out an inaccurate statement, which also demonstrates that the US government socialists have no limit to their greed in taking money from it's citizens. What started out as a " justifiable fair" tax against billionaires during our darkest hours fighting tyranny in Europe has been extended over time to at least the upper middle class (if not lower) without any such justification other than power hungry politicians who trade votes for other peoples wealth. So, no, it's not 90% anymore, just 33/35% (and bound to rise soon), and no its not a million anymore, it's only ~$165K.

Not a crap mountain, but it's still a pretty large pile of crap.

Edit: My cursory check on house values over time shows that a $10K home in 1945 would now be worth $170K (and falling). http://mysite.verizon.net/vzeqrguz/housing...s_1890-2008.png So, realistically... $1M in 1945 would be like $15M now.

[eppie]

Only people with "Income" pay income taxes. The wealthy dabble in investing and owning appreciating assets, but it is only considered "income" when they are forced to sell something (which is seldom).[/q

But we are talking about swiss bank accounts so income tax is not the issue here.

The tipping point has been reached here. The US government actively prevents people from becoming, or remaining wealthy.

I think people taking out bigger loans than they could cope with together with bankers prevent people from becoming wealthy.


Anyway, I don't think a too low amount of wealthy people is the biggest problem of the US.

We have been discussing this more often but generally the countries with the biggest tax burden are the richest and most developed (except of course for Switserland, but we know where they get their money from).
On a structural basis it is impossible to 'run' a state with little or no taxing. It can go fine for a country that is just founded and that has an incerdibly huge piece of land for the taking with all its natural riches, or for the old colonial power that just got all there riches using slavery and stealing from other countries...but for the rest impossible.