Wednesday, August 31, 2016

EU Orders Apple To Repay $14.5 Billion In Irish Tax Breaks

By a sea of strange coincidences Fintan O'Toole might be related to my hero ;-) We should collect Apple's £13 billion and change Ireland: Take Your Pick!

CEO Tim Cook says he’s “confident that the Commission’s order will be reversed.

New York Times editorial, Apple, Congress and the Missing Taxes:

Apple and the United States are crying foul over the ruling in Europe that Apple received illegal tax breaks from Ireland and must hand over 13 billion euros ($14.5 billion), a record tax penalty in Europe. But Apple and the United States have only themselves to blame for the situation.More on the EU Apple $145 billion tax dispute
*Following up on Tax Poffessor's previous coverage of the EU-Apple tax dispute

*The Implications Of Apple's $14.5 Billion EU Tax Bill 

Apple TreasuryThe Hill op-ed: U.S. Treasury Publishes White Paper in Support of Tax Avoiders, by Edward Kleinbard (USC):
The U.S. Treasury Department has just published a tax policy white paper which amounts to a lawyer’s brief defending the brazen abuses of tax administrative processes clandestinely orchestrated by U.S. firms in cahoots with a handful of European countries. It’s August, and nearly the end of the Administration’s term to boot, so in the ordinary course even tax professionals could be forgiven for ignoring the white paper. But this is not simply another tedious tax policy exercise.
Simply put, “business friendly” jurisdictions (like Luxembourg) in substance offered through secret private deals to provide U.S. multinationals with tax shields in the form of their laws and European tax treaties, in return for what in substance were modest fees from the multinationals. All of this was revealed principally by the LuxLeaks scandal. I have worked in the area for 30 years, and I was awestruck by the sleaziness of the operations that came to light.

EU Orders Apple To Repay $14.5 Billion In Irish Tax Breaks

Nota Bene:  Tax wars are looming and the US has fired a shot across the EU's bows

Grassroots and Taxes: Still Going Over The Top

Dance to a new tax tune entitled OVDP (--- Offshore Voluntary Disclosure Program), by Robert S. Steinberg of Palmetto Bay, FL, sung to the tune of “Tonight,” by Leonard Bernstein & Stephen Sondheim, from West Side Story... 

By a sea of strange coincidences Fintan O'Toole might be related to my hero ;-) We should collect Apple's £13 billion and change Ireland: Take Your Pick!

The entire point of life is to be noticed. You want people to notice you. Otherwise, what’s the point? Why even bother. When I’m walking down Fifth Avenue and someone doesn’t peek at me at least a little bit, I give them a little shove. “Hey buddy! Here I am. Deal with it.” 
And it isn’t enough just to be noticed. I could walk down the street in a clown suit and people would notice. I don’t want that. I want respect. I want to be respected. Respect. Noticed and respected. The best way — the only way — to get both immediately is to look important. Gary would probably say something completely impractical like “do good work and respect will come.” Who’s got time for that? That’s probably why I’m in Nevis and he’s in his office writing product reviews. (He probably doesn’t even know where Nevis is.) The arrogant tax lawyer guide to looking important 

Corruption Currents: U.S. Pays Millions to BHP Billiton Whistleblower WSJ

HMRC too fragmented and failing to address customer service 

Billions in Losses Trigger Danish Overhaul of Taxation Model 

Confronting tax fraud, Denmark will hire tax inspectors instead of firing them  

Jack Townsend, Congressional Staffer Charged with Failure to File. “I post this item because it is unexceptional and exceptional for failure to file cases.”

Leslie Book, Tax Crime Snapshot: Ministers, Congressional Staffers and Restaurant Owners. “Politico reported this week that ‘Isaac Lanier Avant, chief of staff to Rep. Bennie Thompson (D-Miss.) and Democratic staff director for the Homeland Security Committee, allegedly did not file returns for the 2009 to 2013 tax years.'”

Great political figures tend to be inspired not by wealth or comfort but by honor and recognition. Few tempted by ambition are about to resist it... Importance of Being 

Europe plans news levy on search engines Financial Times

The US Treasury just declared tax war on Europe   Efforts around the world to crack down on tax dodges by businesses and wealthy individuals via overseas tax havens are making progress. A draft criteria compiled by the OECD to beef up international rules on taxation is likely to be formally approved at the Group of 20 summit in Hangzhou, China, early next month, with the number of countries taking part in the framework for such efforts expected to top 100 by the end of the year.

Stop International Tax Havens

These 2 tax havens rank above Switzerland on per capita  

Panama Papers Prompt Race for Tax Haven Dollars Before Crackdown 

 HMRC secured 13 offshore specific prosecutions since 2009

In United States v. Morrison, ___ F.3d ___, 2016 U.S. App. LEXIS 14888 (5th Cir. 2016), here, an appeal from a trial by Judge John H. McBryde (ND TX), the Fifth Circuit affirmed the taxpayers' convictions.  The Fifth Circuit's opening gives the background relevant for the present discussion (bold-face supplied by JAT):

Running a profitable small business is notoriously difficult. But the clients of a tax preparation service run by a husband and wife, Gladstone and Jacqueline Morrison, brought business failure to a new level. Year in and year out, the vast majority of the clients submitted tax returns showing sizable business losses. A federal jury provided the following explanation for this seeming anomaly of unlucky clients: the Morrisons helped their clients prepare returns with fake business losses so the clients could obtain refunds rather than pay the taxes they owed Via Jack Townsend Federaltaxcrimes

U.K. Threatens Tax Evaders With Fines Three Times Unpaid Taxes

August Tax Justice Network podcast: are the big four accountancy firms really the ‘big one’?

David Herzig, House Staffer is a Tax Protester? (Surly Subgroup). “I mean, who at payroll in Congress is green-lighting the stopping of withholding?”

National Law Review, Taxpayer Argues First Circuit Should Not Follow Tax Court Decision by Judge Indicted for Tax Fraud. “The taxpayer’s brief argues that the Tax Court opinion in Bank of New York Mellon should not be followed because ‘the judge in that case—Judge Diane Kroupa—faced a disabling conflict when she rendered” the opinion due to the fact that she was indicted for tax fraud in April 2016 and was under audit by the IRS and allegedly committing further tax fraud at the time she was considering the Bank of New York Mellon case.'”

Wall Street Journal, Republicans Take New Tack on Taxing Companies’ Overseas Profits:

President Ronald Reagan once chided government’s approach to the economy as following this mantra: “If it moves, tax it.”
Today’s Republicans are following Mr. Reagan’s ideas by trying the exact opposite approach. The tax plans from House Republicans and presidential candidate Donald Trump stop aiming at the moving target of U.S. companies’ foreign profits. Their plans would alter existing rules so thoroughly that companies would get little advantage from cross-border tax maneuvers they perfected over decades and move the U.S. toward taxing immobile parts of the economy. 
Department of Justice Press Release, Congressional Staffer Charged with Failure to File Tax Returns for Five Years:
A congressional staffer was charged yesterday with five counts of willfully failing to file a tax return, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division and U.S. Attorney Dana J. Boente for the Eastern District of Virginia.
HMRC: Tough new sanctions for offshore tax evaders

Russ Fox, Paying Employment Taxes Is Optional…Until You Get Caught. “If you want to visit ClubFed, having employees and not remitting payroll taxes is a quick and easy way to do so.”

Jack Townsend, Sentencing for Defendant Implicated in Early UBS Disclosures. “Lying to the IRS or being economical with the truth in submissions to the IRS where full cooperation is required is a no-no.”

Farewell to Jan Farrell

Bloomberg: What Is Amazon’s Core Tech Worth? Depends on Which Taxman Asks, by Gaspard Sebag & David Kocieniewski:

Jeff Bezos’s relentless focus on user experience has helped him make Amazon the most valuable e-commerce company in the world. But regulators in Europe and the U.S. say that the value Amazon places on the technology behind that experience varies radically depending on which side of the Atlantic it’s on—and which appraisal will lower its tax bill.

Frank Wolpe (Bentley), Getting Back to the "Grassroots" of Tax Administration: Because "We the People" Long For a Gathering of American Eagles to Restore Trust in the Internal Revenue Service with A Rebuild IRS Initiative49 Akron L. Rev. 863 (2016)

Assets of Scottish shell firm seized amid probe in to allegedly corrupt Ukrainian MP Herald Scotland 

Hundreds of Scottish PFI schools now owned by offshore funds 

Tax Vox: Federal Taxes Are Very Progressive, by Robertson Williams:

The US federal tax system is highly progressive, primarily because individual income tax rates rise sharply with income and refundable tax credits lead to negative income taxes for households with low income. Updated estimates from the Tax Policy Center project that effective federal tax rates this year will range from 3.5 percent for households in the lowest-income quintile (or fifth) to 33.0 percent for those in the top 1 percent.

The History of Money: Not What You Think The Minskys

CCH Daily, 19/8/16. HMRC plans to use the introduction of the Making Tax Digital (MTD) online strategy to move to a points-based penalty regime for failure to submit tax information on time, using a graduated model similar to the ‘speeding points’ system used for drivers who break the law, and is also potentially seeking wider investigative powers 

Keith Fogg, The First Reconsideration of a Case Due to Former Judge Kroupa’s Tax Problems (Procedurally Taxing):

Former Tax Court Judge Kroupa resigned from the Tax Court on June 16, 2014, apparently in response to an IRS criminal investigation concerning the tax liabilities of herself and her husband.  We previously reported on her resignationhere.  At the time the indictment came out, some speculation occurred in the tax press about the impact of her tax troubles on the decisions she rendered, see here.  In Eaton Corporation v. Commissioner the first case that we are aware of involving the fallout of Judge Kroupa’s indictment comes before the Tax Court for it to review whether her decision should be reconsidered. 

World losing $2.6trn annually to corruption

The Real Russian Mole Inside NSA.
The recent appearance on the Internet of top secret hacking tools from the National Security Agency has shined yet another unwanted spotlight on that hard-luck agency, which has been reeling for three years from Edward Snowden’s defection to Moscow after stealing more than a million classified documents from NSA. As I explained, this latest debacle was not a “hack”—rather, it’s a clear sign that the agency has a mole.

HMRC takes aim at tax dodgers hiding foreign income

ABA Perspectives: A Magazine For and About Women Lawyers, Vol. 24, No. 4, Summer 2016, at 8:

In September, [Lewis & Clark Dean Jennifer] Johnson will host the first Gathering of Women Law School Deans, a day-long event to facilitate conversations on topics of mutual interest. The challenges are especially acute now as the world of legal education undergoes a seismic shift. ...

Tuesday, August 30, 2016

Obit of Sir Anthony Jay, co-creator of Yes Minister

This is from the Telegraph Obit of Sir Anthony Jay, co-creator of Yes Minister:
“However, not many, perhaps, were aware that the serial was commissioned with a serious political purpose: to popularise public choice theory. It is because it succeeded spectacularly that Jay received a knighthood in 1988.”
There are numerous interesting points in the obituary, for instance:
In Zimbabwe, Robert Mugabe was said to be a No 1 fan.
Enclosed is Tyler Cowen's  earlier Conversation with Margalit Fox, senior obituary writer for The New York Times

I come from a (cold) place where the water
is so barren that when you drink it
the fish of the throat die,
causing malignant thirst. 
What’s a dazzler like you
doing in a dump like my bed?

Max Joseph Ritvo was born Dec. 19, 1990 ( a year after the Velvet Revolution), in Los Angeles. A literary prodigy, he was writing at 3 ...
Max Ritvo, Poet Who Chronicled His Cancer Fight, Dies at 25 (My sister Aga passed away at the young age of 22 my heart goes to Max's parents and siblings [Funeral of Youth 2004])

"Gene Wilder on Willy Wonka Remake, Young Frankenstein, Mel Brooks, and more " (28 minute YouTube video, June 2013). This is the last major interview of Gene Wilder, who passed away earlier this week. Here's an excerpt courtesy of The Daily Beast...

Spectre of Existentialism invaded 256 cafe at noon as former legal eagle and hard access guru took the boy who lives down the Whiskey Lane and me to Central Europe, Nuremberg trials, brave use of privilege matters during Gestapo interogations book like the Witness to Nuremberg  and Church of Spies ...

Pope John Paul II made history in 1978 by becoming the first non-Italian pope in more than 400 years. Some insiders and journalists knew Pope John Paul II the great was not only non-Italian he was also non-Catholic ...

The improbable story of the man who won history’s ‘biggest murder trial’ at Nuremberg WaPo

Denmark will spend more than $1 billion to upgrade its tax inspection system, 10 years after it began sacking thousands of people who worked for the inspection office.
In the past three years alone, Denmark figures it has lost 12.3 billion Danish crowns ($1.87 billion) in tax fraud. Hence the decision announced on Friday to start hiring people instead of firing them
Denmark will spend more than $1 billion to upgrade its tax

Billions in Losses Trigger Danish Overhaul of Taxation Model Billions in Losses Trigger Danish Overhaul of Taxation Model

By some strange coincidence a former colleague sent me this link:

The Church Of Big Data  (Not Spies) – A Quack Religion?
“Just as divine authority was legitimised by religious mythologies, and human authority was legitimised by humanist ideologies, so high-tech gurus and Silicon Valley prophets are creating a new universal narrative that legitimises the authority of algorithms and Big Data. This novel creed may be called “Dataism”. In its extreme form, proponents of the Dataist worldview perceive the entire universe as a flow of data, see organisms as little more than biochemical algorithms and believe that humanity’s cosmic vocation is to create an all-encompassing data-processing system — and then merge into it.”

A piece by Yuval Noah Harariin the Financial Times this weekend delves into our fascination with Big Data. The tech industry has made so many billions of dollars being able to track, quantify and more

Meet Sasha aka Alex- one of the hardest working public servants  

Online tech magazine scores a stunning story about Alex's sibling Siri who had a brain transplant" Artificial Intelligence Is Already Here—and It's In Your Jobs' iPhone

Sociology vs. economics

"Small change, big impact - lessons learnt from changing the hub"
This blog post describes a recent change we made to the order of questions in the hub, how we made an unexpected 10% improvement and, most important of all, what we learnt... Small is beautiful

The FOI act does not afford sufficient protection to public servants

"Using a false Social Security number is a crime -- but is it a crime 'of moral turpitude'?" Eugene Volokh has this post at "The Volokh Conspiracy."