The Tax Man and the Pot of Gold at the End of the Dubai Rainbow
Submitted by Economy CSI on March 27, 2007 - 9:34am.
Current Events | Economics | Economy | Economy CSI | Humor
The Tax Man and the Pot of Gold at the End of the Dubai Rainbow
By the Economy Team
From Wes Clark's 2004 Campaign Position Papers
Manufacturing Security Plan:
Stop rewarding companies that shift jobs overseas.
- Stop tax breaks for companies that move overseas for tax reasons.
Wes Clark would close outrageous loopholes in the tax code, like the ones
that allow companies to avoid taxes by shifting income to Bermuda.
- Deny government contracts to firms that move headquarters overseas for tax reasons or shift substantial numbers of U.S. jobs overseas. Wes Clark believes that companies should not be rewarded for moving their headquarters to overseas tax havens or shift substantial numbers of U.S. jobs abroad.
Treasury Direct - The Debt to the Penny and Who Holds It - Updated Daily
When I was a kid, my best friend Tim Murphy, aka Murph, was the best basketball player in the neighborhood. Then he was the best in high school. It was one tough break when he injured his knee, blowing his chance for a spot on a top college team.
Lucky for Murph, he was also a very smart guy with a head for figures. He got his CPA. Went to work for the IRS as an auditor, but decided with all the changes and outsourcing, he’d rather be on his own. He hung out his shingle to become a very successful tax man. I’ve been having him do my tax returns ever since.
One thing about Murph, I’ve got to get my tax information to him early and don’t even think about talking to him until after the NCAA tournament is finished. The best time for me to see him is after St. Patrick’s Day. It’s our annual post St. Paddy’s reunion for old friends. We go over my tax return and then grab dinner at a nearby pub. It’s our time to catch up in real time, rather than the usual e-mail exchange or phone tag messages.
Murph’s been trying to get me to spill what the super secret case was about, but I tell him like everyone else, “My lips are sealed.” He thinks he’s figured it out, a tax haven investigation. He sent me this Forbes link for the Best Tax Haven Getaways and the IRS Talking Points on Abusive Offshore Tax Avoidance Schemes. At the pub he makes a joke thinking he can get me to slip and spill the beans. He says, “You know a tax-dodger is a man (or corporation) who does not love his country less, but loves his money more.” I told him that sounded like something straight out of a fortune cookie. I remind him President Bush talked about tax-dodgers in his 2004 campaign. I suggested he read David Cay Johnston’s recent article in the New York Times if he wanted to really give himself heartburn. I confessed I’d seen the building in the Cayman Islands where all those corporations, like Halliburton have their dummy headquarters, Senator Dorgan wrote about in his book Take this Job and Ship It, but that’s as close to looking at tax evasion as I got. “Can’t tell you who I was investigating Murph, signed a confidentiality agreement.” Murph and I both agree we can’t stand tax-dodgers.
We live in a great country. Everybody has to pay their fair share. We were both so amazed to hear about Halliburton moving their headquarters to Dubai, the double tax haven of them all. This time, instead of a mail drop, the CEO says he’ll reside in Dubai.
Go figure.
My old friend, the tax man, tells me there’s hope on the horizon to target the billions of dollars lost in tax revenue, because of overseas tax havens. “It’s something like $100 billion a year,” he tells me. Three senators are working in a bipartisan way to go after this tax revenue. Maybe if we get Pay-Go reinstated as law, we’ll start seeing the national debt get smaller instead of bigger everyday. Then he winked at me as he reminded me not to forget to send my check to Uncle Sam with my tax return. At that point we made our usual belated St. Pat’s toast, wishing each other the luck of the Irish and a pot of gold at the end of the rainbow. I’m not going to tell what we wished for tax dodgers like Halliburton. My lips are sealed.
SOURCES
Wikipedia - Tax Haven
The Best Tax Haven Getaways by Christina Valhouli Forbes Online
Internal Revenue Service Abusive Offshore Tax Avoidance Schemes - Talking Points
Bush Jokes About Tax Dodgers by David Corn 8-10-2004 The Nation
I.R.S. Letting Tax Lawyers Write Rules by David Cay Johnston 3-0-2007 New York Times
Halliburton will move headquarters from Houston to Dubai Contributing James R. Healey, Reuters, USA Today
ShelterOffShore.com - Benefiting from Dubai’s Double Tax Treaties
Senators Set Sights On Overseas Tax Havens by Mark Drajem and Ryan J. Donmoyer Bloomberg News 2-18-2007 Washington Post
Treasury Direct - The Debt to the Penny and Who Holds It - Updated Daily
My CPA once said, "The tax code can either be fair or simple. It will never be fair, so it might as well be simple."
Stan Davis
Lakewood, CO
If not us, WHO? If not now, WHEN?
BE THE CHANGE you wish to see in the world.
is the page ShelterOffShore.com. The fact that it actually exists, is out there, is just mind-blowing.
Sample:
"....such profits earned in Dubai may not be taxed at all as corporate income tax is not levied in the UAE!
Simply put, dividend income paid by a company in Dubai to a company which has a double taxation treaty with the UAE may not necessarily be taxable in the hands of the foreign parent corporation even though it has not been taxed in Dubai either as it will be considered to have been taxed at 0% in Dubai.
But before you all get too excited, unfortunately not all international or foreign companies in the UAE are so fortunate!
Some of the more taxation hungry and repressive nations globally have anti-avoidance legislation in place which puts paid to these benefits. Such legislation can either set minimum taxation levels for a company’s profits, or else the legislation can set out lists of low-taxation countries which don’t actually qualify under their tax treaties.
This means that it is important for foreign corporations and international businesses interested in establishing themselves in Dubai to study and understand the tax legislation of each of Dubai’s treaty partners as well as getting to grips with the exact text of the UAE’s double taxation treaties before accepting anything about the potential tax treatment of income flows that originate in Dubai.
Dubai and the UAE are doing everything they can to attract foreign investment, but unfortunately many other countries globally are doing everything they can to restrict freedom and stop free trade in an attempt to hold on to as much taxation as they can!
But don’t be put off! There are a lot of ways to make the most of the offshore opportunities available in Dubai and other tax havens around the world, it is simply important to get the right information and advice - relevant to your personal circumstances and requirements.
We offer a free information and advice service."
That sent me over the edge into one of those fits I have that result in nothing more productive than frightening the dog and bruising my knees on the desk.
Honest ta god. I don't want to be such a cynic about the world but good golly, you see something like that and you either have to laugh or cry or go mad. (I'm still deciding.)
I took some more time and read this:
http://www.shelteroffshore.com/index.php/offshore/more/us_crackdown_on_offshore_tax_evasion/
US Crackdown on Offshore Tax Evasion
snip
"While there is absolutely no question about the absolute legality of the major offshore tax havens and investment structures, it is the misuse and abuse of such havens and structures by those who are not legally entitled to the benefits and gains they offer that the IRS have been questioning in their report…however, some of the offshore advisories named in the report refute the IRS’s claims stating that their reporting is one-sided – we take a closer look…"
It looks like in Dubai's case, there is some agreement as to legality of off-shoring...and at least recognition of legitimacy. So I take back my fit. (Wish I could take back the bruised knee...)
they believe will reverse the deficit trend over the next 5 years. It permits the tax cuts for the rich to sunset and relies on Pay-Go to manage our budget. Now, let's see what the senate does. Keeping my fingers crossed we are heading in a new direction regarding our debt situation. We'll all have to keep a watchful eye to see where our tax dollars are going.
kinda asap since tax day April 15th coming right up.... excellent for myDD.com too
TIME IS DISTANCE DIVIDED BY VELOCITY - not much L?
http://www.dailykos.com/story/2007/3/30/162430/174
the links work at the comment: Dubai Rainbow: Halliburton Offshore Tax Haven
The only result of lower taxes: richer rich people
by Jerome a Paris
Fri Mar 30, 2007 at 02:03:09 PM PDT
Forbes link for the Best Tax Haven Getaways and the IRS Talking Points on Abusive Offshore Tax Avoidance Schemes: http://www.forbes.com/...
You know a tax-dodger is a man (or corporation) who does not love his country less, but loves his money more. http://www.irs.gov/...
President Bush talked about tax-dodgers in his 2004 campaign.
http://www.thenation.com/...
David Cay Johnston’s article in the New York Times http://www.nytimes.com/...
Senator Dorgan wrote about it in his book Take this Job and Ship It
Halliburton moving their headquarters to Dubai, the double tax haven of them all. http://www.usatoday.com/...
It's not a tax haven, but as the tax code goes, this is an extremely sweet deal. Time to close another loophole.
Bernake (sp?) last night on the sub-prime debacle. (Another one just folded her in CA-- bankruptcy)
Schumer was pretty good. In any case, I found it the perfect venue to fall asleep to! : )
Congress may close some of the loopholes:)
