As featured on p. 218 of "Bloggers on the Bus," under the name "a MyDD blogger."

Monday, July 13, 2009

No Numbered Bank Account Information For You

If the IRS simply collected what it was owed, particularly by rich people with tax shelters and secret stashes and corporations with mailboxes in the Cayman Islands that serve as their headquarters, we would actually be much closer to a balanced budget than you could imagine, and by eliminating the kind of loopholes that facilitate this theft, essentially, we could lower overall tax rates while increasing revenue. But this treaty with Switzerland designed to get information on Americans holding Swiss bank accounts in contravention of federal tax law shows how arduous a process this will be.

A new treaty touted as helping U.S. law enforcement crack Swiss bank secrecy may do little to help authorities achieve a prime objective: exposing tax evaders.

In an interview this week, a top Swiss official cited the recently negotiated treaty amendment as evidence that Switzerland is moving toward greater openness. Doris Leuthard, Switzerland's vice president and economic minister, emphasized that in the future the treaty amendment now awaiting ratification would give the United States access to information in cases of tax evasion, which are not covered by an existing treaty between the two countries.

But Leuthard also said that under the treaty amendment, the United States would have to know the names of suspected tax evaders to obtain information about their Swiss accounts [...]

Jack Blum, a lawyer who specializes in international tax and money-laundering matters, said the treaty amendment boils down to this: "If you have the information, we'll give it to you."

The main value of the agreement is that "it gives everybody the ability to say we signed an agreement," Blum said, but "I don't think that qualifies as solving the problem."

The Swiss make lots and lots of money riding on their numbered accounts, and I don't know that you can get them to roll back the kind of secrecy that makes them a leader in global depositing. The US and Switzerland currently are seeking a deal that would get the names of over 52,000 Americans hiding fortunes overseas. But I wouldn't bet the ranch on success.

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