posted on Apr, 5 2013 @ 02:37 AM
The flat tax doesn't stop this type of tax evasion because the perpetrators are simply not reporting income. The flat tax only taxes income that is
The U.S. IRS is working on this issue, but, they have limited resources. The voluntary disclosure program has collected approximately $4.4 billion in
back taxes from these tax havens to date. The new Foreign Account Tax Compliance Act, FATCA, is requiring foreign countries to disclose to the IRS
the account holdings of U.S. account holders beginning in 2013. This is very complicated and will not be fully implemented until 2018. Obviously,
not every country will participate, but, Switzerland amended its laws in order to do so.
I am a CPA and have represented several people who have went through the voluntary disclosure program. Not all of them are cheaters. Many are
immigrants who inherited money, left it offshore and it just didn't occur to them they were required to report the funds. I have one client who fled
a country that became radical Islam over the years, lopped off his brothers head for being Catholic and he fled for his life with the clothes on his
back. He owned a business in his home country that was worth several $million, but, he thought he would never see it again. He put it out of his
mind, moved on with his life, didn't tell anyone about it etc. Now 20+ years later, he has recouped some of those assets and the IRS received 25% of
the business value because he didn't report a few thousand of interest income from accounts he didn't believe were recoverable. Something about not
wanting to get his head lopped off if he went back... There are also many outright criminal cases where the IRS is prosecuting and imposing stiffer
The well to do will always get away with more than the rest of us. The utter disregard for playing by the rules has resulted in the backlash of new
rules I have cited above. It won't stop them all, but, it will make it hard enough that a high percentage won't try.
The Swiss among some other tax havens are the real criminals here. There game went something like this. Put your investment assets with us. We
won't report it to the IRS ever. We will charge you a fee for handling your money. You can use a credit card / debit card against your account for
all your expenses and we will never report it to the U.S. If you need something, for a fee, your own personal banker will take care of it. Pretty
good deal, huh? Someone offers to treat you like a king, charge you a huge fee, but, you are still ahead because you pay less in tax than the amount
of the fee while someone is kissing your behind doing it.
the original whistleblower collected
$100M from the IRS for turning in his former employer.