Names, we want names!!!

[Long Run]

So, has anyone parsed this situation to determine if the wealthy on the list are engaging in tax avoidance (legally moving funds to lower/no tax jurisdictions) or are they engaged in tax evasion (illegally sheltering income that is subject to tax)? Bigwigs in democratic countries can be embarrassed by either, but they only get in trouble if they are evading taxes. I don't think it matters either way to the strongmen/dictator types.

[MajGenl.Meade]

Good point

[Big RR]

Well LR, IMHO fleeing the jurisdiction to avoid taxes is always different from tax avoidance; it's akin to you or I leaving the US and changing our citizenship to avoid paying US taxes. Is it legal? Likely it is; but it is very different from taking a legal tax deduction; and many are working to craft laws to tell them "don't let the door hit you in the ass on the way out"

Why the (Gob has a word for it) are you so insistent on pretending these people are patriots?

Please, where have I said that people moving assets overseas to avoid taxes are patriots?

[MajGenl.Meade]

Show me a rich person who delights in paying taxes because they have faith in the government - better make that 17 rather than 1 - there might be another nutcase out there

Warren Buffett
Bill Gates (Sr)
Myself

If you really have no faith in our government then you really don't believe in democracy. Even the possibility of.
yrs,
rubato

Two rich people and a nutcase then

Don't bring "me" into this - I've not said a word about my not having faith in our government. I pay the proper taxes without dodges (legal or illegal).

[Lord Jim]

So, has anyone parsed this situation to determine if the wealthy on the list are engaging in tax avoidance (legally moving funds to lower/no tax jurisdictions) or are they engaged in tax evasion (illegally sheltering income that is subject to tax)? Bigwigs in democratic countries can be embarrassed by either, but they only get in trouble if they are evading taxes. I don't think it matters either way to the strongmen/dictator types.

Good points all.

[MajGenl.Meade]

Why the (Gob has a word for it) are you so insistent on pretending these people are patriots?

Please, where have I said that people moving assets overseas to avoid taxes are patriots?

You made a comparison between volunteers in WW2 (faith in the government) and demonstrators against the Vietnam war (no faith in government). You then seem to suggest more than once that people having no faith in the government are somehow (like the anti-VN war demonstrators) excused for their tax avoidance - because they are not "happy". It's the mean old government that's driving them to hide their cash. Why, it's almost patriotic to demonstrate disapproval in this way.

Do you really think that if rich people "had faith" in their government (oh no - all these people being exposed ARE the government!) they'd stop avoiding taxation? I bet the Icelandic PM had faith in his own government - probably loves his country too. What on earth is your point about "happiness" and "faith" in government?

[rubato]

So, has anyone parsed this situation to determine if the wealthy on the list are engaging in tax avoidance (legally moving funds to lower/no tax jurisdictions) or are they engaged in tax evasion (illegally sheltering income that is subject to tax)? Bigwigs in democratic countries can be embarrassed by either, but they only get in trouble if they are evading taxes. I don't think it matters either way to the strongmen/dictator types.

No, they also get into trouble when they are concealing a conflict of interest (the PM of Iceland, you didn't read the article) or a lack of patriotic concern for their own country (the President of Ukraine depriving Ukraine of needed taxes was more motive than his reducing them by moving the business 'offshore', so to speak). Or in the case of Putin (and his favorite cellist) when the money is part of a corrupt criminal organization.

Tax avoidance is only a very small pert of the total.



yrs,
rubato

[rubato]

Why the (Gob has a word for it) are you so insistent on pretending these people are patriots?

Please, where have I said that people moving assets overseas to avoid taxes are patriots?

You made a comparison between volunteers in WW2 (faith in the government) and demonstrators against the Vietnam war (no faith in government). You then seem to suggest more than once that people having no faith in the government are somehow (like the anti-VN war demonstrators) excused for their tax avoidance - because they are not "happy". It's the mean old government that's driving them to hide their cash. Why, it's almost patriotic to demonstrate disapproval in this way.

Do you really think that if rich people "had faith" in their government (oh no - all these people being exposed ARE the government!) they'd stop avoiding taxation? I bet the Icelandic PM had faith in his own government - probably loves his country too. What on earth is your point about "happiness" and "faith" in government?

He was not avoiding taxes he was concealing the fact that his personal interests were at odds with those of the country. Read the article. it is the same type of corruption that James Watt (secretary of the interior under Reagan) tried to conceal by transferring grazing rights to his son.


yrs,
rubato

[liberty]

No Mr. Meade I would think that lack of patriotism would lead one not to pay taxes. When I was young I was a super patriot; I willing paid my state income tax when I easily could have gotten out of it. I was stationed in Florida; Florida had no state income tax and all I had to do was to claim to be Floridian and then I could have legally avoided the tax. Everyone else was doing it, but I didn’t; I felt that paying was the right thing to do. I knew I had no plans to stay in Florida. To me doing the right thing was more important than money; maybe I am a nut.

On the other hand, perhaps in the mind of some not paying taxes is the patriotic thing to do. The sooner this country collapses the sooner it can be reborn as something better.

I feel sure that patriotism is dying in this country. If Russia invaded Alaska I don’t think the government could raise enough volunteers to fill a division. My own grandchildren will not fight for this country.

[Big RR]

You then seem to suggest more than once that people having no faith in the government are somehow (like the anti-VN war demonstrators) excused for their tax avoidance - because they are not "happy". It's the mean old government that's driving them to hide their cash. Why, it's almost patriotic to demonstrate disapproval in this way.

If that's the way you see it Meade, I don't think there's much more to say. IMHO, it has little to do with patriotism (at least in the knee jerk, jingoistic, my country right or wrong way it is usually applied in the US). These are people who choose to leave the country rather than pay taxes, nad the question is--what drives them to that? IMHO, a major part of it comes from their belief (however justified or unjustified) that the government no longer serves their interest. From your posts, I guess you would disagree with that.

[MajGenl.Meade]

Big RR, I believe tax dodgers dodge taxes because they like keeping their money.

Granted, they seem to have the idea that the government wants too much of their money in taxes. But I'd guess that rich people in the USA who DO think their government is serving their interests STILL try to hide money from the tax man (or shelter it, if that's a better term). Vladimir Putin - seems to think his government is serving his interests but still likes to squirrel money away in hiding. Fancy that!

I don't think anyone else has mentioned people leaving the country rather than pay taxes. So I'll not disagree with whatever that was about.

[Econoline]

Leaving the country--whichever country--to avoid paying taxes would be the honest way. Living in one country because you like living there (and making money there), but keeping your money in another country to avoid financially supporting the country you choose to live in is much worse, IMHO.

[Gob]

We'll be living in Blighty, but our funding will be Australian.

I'll be doing my damnest to minimise our tax outlay!!

[Lord Jim]

I'll be doing my damnest to minimise our tax outlay!!

As do most sane people...

But then, most people aren't simultaneously claiming they want their taxes increased...

Those people are world class hypocrites of the most blatant and obnoxious sort...

[Big RR]

I don't know Jim; I think we can all agree that if we want the government to provide services to the population as a whole, that it will cost money. and I similarly think we can all agree that the money needed must come from the taxpayers. No one wants to pay more taxes, but some of us realize that we may have to pay more for the services the government provides, whether it's sending armies over to Afghanistan or paving roads, or whatever. So it's not hypocrisy to say I won't pay for more than I have to, yet agree that each of us benefitting from those services may have to pay more. It's certainly a lot less hypocritical than clamoring for tax cuts, maintaining or increasing services (like all the money put into the "war on terror"), and then just bloating the deficit to pay for it.

[Lord Jim]

No one wants to pay more taxes

Au contraire mon ami...

Rube does (at least he says he does):

My taxes are too low.

viewtopic.php?f=3&t=5839&p=71729&hilit= ... +my#p71729

And I can bring a number of other examples where he has expressed the same view...

I'll concede that rube's an outlier on this...(as he is on so many things...)

The bottom line is, (as I've repeated many times) anyone who believes their taxes are too low (for whatever reason) is perfectly free to pay more to the federal government anytime they choose...

The government will be happy to accept the money. They can do it right now, this afternoon; just pick up a pen and write the check....

(Of course in rube's case there's one minor detail that might prevent him. In his case, unlike Buffet or Gates, the vast bulk of the income in question wasn't actually earned by him, so he'd probably have to get the actual bread-winner to sign off on the idea... )

[Big RR]

Well Jim, then let me ask you--given the size of the deficit, do you feel that taxes are too low to fund what the government is paying for?

[rubato]

You'll have to keep track of dates on those quotes because our marginal and effective tax rates went up between 2013 and 2014 (I don't have the numbers yet for 2015) when the Bush-stupid tax cuts expired.

Marginal went up 5% to 33%. A step in the right direction and part of the reason that the deficit under Obama has shrunk so rapidly (after exploding under the Republicans, again).

I try to understand my obligations moral, legal, and practical and it is a pleasure to be able to fulfill them.

Our total income and property tax bills for 2014 are just under $100,000. I do not whine and complain like a little child because I have obligations and I must pay them. I am a man and it is a matter of simple dignity to do my part. We make a lot of money. We live well. No one in our situation has a right to whinge and whine because there and things we owe to others. We make enough money that we hardly ever make a decision based just on costs.

As to my legal tax obligations I am happy to pay it. I don't cheat or take any questionable deductions. If the tax rate is to low (as I have said) then the best way to change it is to allow the negative effects of a bad policy to be apparent. One of the least intelligent arguments is "you can volunteer to pay as much as you'd like". It will have no aggregate effect thus it is a null choice. How stupid!.

We also give to a number of organizations which you can call self-taxing: Planned Parenthood, UCSC, The Tropical Health Alliance Foundation, Gimbe Hospital (sometimes), misc smaller donations. But the fact is that we do these things because it pleases us to do them. When our taxes are raised we will do the same as we do now. It is more a privilege to be able to contribute than a sacrifice. Overall I think we give too little.

I stopped doing our taxes back in 2000. (LJ is a moron) but I do our financial planning and tax estimation which is probably why he was confused about that. I have used information from that research to prove how badly the tax system is skewed against lower-income people (making less than $150,000 yr).

We still save about $100,000 yr in pre-tax instruments but that will likely change in the next year or so as the planned retirement date approaches.

Anyone who has a household income of less than $250,000 and votes Republican, is an asshole. You are screwing yourself your community and your children.


yrs,
rubato

[Long Run]

Not a U.S. or western problem.

The leak of confidential documents from Panama law firm Mossack Fonseca has had many interesting results. We’ve seen the biggest dump of confidential documents in history. Prominent international figures have been revealed as the holders, or near-holders, of shadowy offshore accounts. The prime minister of Iceland has resigned over allegations of impropriety.

Less interesting is the predictable result: a flurry of people rushing to blame “global capitalism.”

“The documents, which show the extraordinary lengths the global elite have gone to in order to shield their wealth from taxation, are at once big news and old hat,” says my friend Freddie deBoer in Foreign Policy. “They provide the nasty details of the kind of business most savvy people assume goes on all the time. You and I pay our taxes; the wealthy find ways to avoid them."

* * * *
What we’ve seen from the papers so far is not so much an indictment of global capitalism as an indictment of countries that have weak institutions and a lot of corruption. And for all the outrage in the United States, so far the message for us is pretty reassuring: We aren’t one of those countries.

Consider the big names that have shown up so far on the list. With the notable exception of Iceland, these are not countries I would describe as “capitalist”: Russia, Pakistan, Iraq, Ukraine, Egypt. They’re countries where kleptocratic government officials amass money not through commerce, but through quasi-legal extortion, or siphoning off the till. This is an activity that has gone on long before capitalism, and probably before there was money. Presenting this as an indictment of global capitalism is like presenting Romeo and Juliet as an after school special on the dangers of playing with knives.

The only American I’ve so far seen identified was a Chicago-area financial coach I’ve never heard of.

* * * *

For that matter, even foreigners who are trying to hide their names might not be doing so for entirely unsavory reasons. People living under unstable regimes may have very good reasons to want to move assets outside the country; Jews in 1930s Germany did not put money in Swiss accounts because they were trying to lower their tax bill, but because they were trying to ensure that they would have enough set aside to flee the genocidal maniac ruling their country.

* * * *

Projecting our concerns onto the governance problems of Pakistan, or pretending that the Russian oligarchs are part of some club that jointly rules the world with the Walton family, is a convenient way to give our local complaints extra oomph by projecting them onto the world stage. But while it may be emotionally satisfying, it’s worse than useless, because it suggests terrible policy solutions to those complaints, or no solution at all.

What we seem to have learned from the documents so far is that this particular sort of corruption isn’t a big local problem for the U.S. We do of course have some law breakers, because there is no such thing as a law that won’t be broken. But it seems to be a minor, furtive thing, rather than the mass habit you see in parts of the developing world. The IRS is very good at finding offshore tax cheats, and getting better all the time. I am confident that if U.S. scofflaws should be revealed by these documents, the tax authorities will waste no time ensuring that they get what is coming to them.

http://www.bloombergview.com/articles/2 ... capitalism