|MOTOR-CITY DETROIT IS $18 BILLION BANKRUPT.|
US CITIZENS HAVE $16 TRILLION IN ILLEGAL TAX-HAVENS.
"BUT ITS VERY COMPLICATED"
The G20 nations conference this week in Moscow is trumpeted as a 'once in a century' chance to close tax-evasion loopholes. The media focus is once again directed onto digital or e-companies who shift taxable profits, repeating the PR messages that (1) trans-national e-companies with "hugely complex business models" are the primary false-accounting villains, and (2) though aggressive, their machinations are legal, and so (3) new global laws are necessary to curb false-accounting, and thus (4) no back-taxes can be levied, and thus finally (5) the 9.5 million people with $32 trillion hidden offshore, and their gangs of inventive advisers, are wholly innocent and can keep all the money offshore, pay no tax, and stay out of prison.
This is of course expensive PR bullshit of the highest order and of the deepest consequences for the global economy. If true, it won't get our money back and so won't recapitalize Detroit, the USA, the EU and OECD nations. The world economy will decline like derelict Detroit and go bust - because of false-accounting.
1) Most international companies, profitable SME's and highly paid executives between them have tens of thousands of tax-haven companies which have indulged in false-accounting since 1980. Most tax-havens were British, but are now evenly spread; all major economies have their favourites. All international business models are as equally complex as computing and telecoms; e.g. The Motor Industry, The Medical Industries, The Food Industry, Banking, J.P. MORGANS' 140 COMPANIES Insurance, Shipping, Mining, Aerospace, Energy etc - and they have all been properly accounted and audited for hundreds of years. We can count - even the profits of e-book sellers.
2) "Tax Avoidance is Perfectly Legal" DUMMY OFFSHORE COMPANIES - ONLY $79.99 Oh no it isn't! This Wall St /City PR message has been so widespread, in the last 5 years, that even otherwise intelligent politicians whose nations are owed trillions of dollars in back-taxes want to believe it. "Yes - We DO believe in fairies". But, false-accounting is false; it is lies, it is illegal.
3) The global international laws to stop false-accounting have existed since 1900 as "Double-Taxation-Agreements" between nations. Many quick-stepping, high-flying, handkerchief waving, bent bookkeepers have danced through the rules only to be tripped, fall and be taxed - and sometimes jailed. No new laws are needed; only the application by national tax-collectors of existing laws. The bent bookkeepers have bribed bent politicians and courts to stay off their cases. $32 trillion buys a lot of friends - and would employ a lot of unemployed youngsters.
4) Because the laws do exist and have existed for a century, all the back taxes avoided or evaded since 1980 can be legally claimed. With penalties and compound interest the claims will amount to the whole $32 trillion (approximately 3 times the evaded taxes). Ask any of the hundreds of local businesses pursued by the IRS or HMRC for back-taxes - the laws do exist and do bite. Detroit and OECD nations need the money repatriated.
5) The 9.5 million offshore Johnny's, concealing $32 trillion (70 million jobs for ten years) have all generated false accounting tax claims, or filed false tax-returns, to shift their assets to tax-havens with local tax-relief. The local tax-collectors can now legally, retrospectively deny false claims - and issue the tax bills - and seize the offshore assets.
BUT WHERE'S THE MONEY? Honest, innocent, wide eyed directors, bankers, lawyers and accountants declaim. PRISM knows - GCHQ knows - IBM banking computers know - The US Treasury knows - The Russian, Chinese, Pacific Rim and Middle East governments know. Debits and credits are not too complicated to track. Treasure chests are easy to find and seize. New laws are not required.