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Sun Oct 17, 2021, 06:49 PM

States must stop letting the ultrawealthy dodge taxes -- and the law

The so-called Pandora Papers leak of almost 12 million documents and files exposes the secret offshore accounts of world leaders, celebrities and billionaires. Yet for many, offshore doesnít mean the Cayman Islands or Switzerland. It means right here in the United States.

For too long, too little scrutiny has been focused on statesí efforts to turn themselves into tax havens for the ultrawealthy. Local legislatures have for decades been devising rules to permit trusts that can be passed down from generation to generation in perpetuity, with scarcely anything paid in taxes along the way. Worse, powerful secrecy shields make it easy to store even ill-gotten gains with impunity. South Dakota, which also levies no income or capital gains tax, is an especially egregious case ó or an enticing one, if you ask those behind at least $360 billion in anonymous, untraceable assets tucked away there. That state started a national trend that has spread to Delaware, Alaska, Nevada and New Hampshire, among others.

The situation has been a boon mostly for money managers and those whose money they manage; it has been a burden for the federal government and other states deprived of a tax base. And it hasnít even really been a windfall for the trust-sheltering states, which arenít getting much in the way of taxes themselves and donít seem to be reeling in more residents or good-paying jobs at any great scale. Indeed, part of the appeal to individuals parking their dollars in South Dakota and the rest is that usually they donít even have to set foot there.

This state-sponsored tax-dodging would be distressing enough on its own. Throw privacy and other shielding provisions on top of it, and itís a scandal. Though management companies claim they do due diligence on clients, the Pandora Papers make clear thatís not the case. The Postís investigation identified 206 U.S.-based trusts linked to 41 countries, nearly 30 of which held assets connected to people or companies accused of fraud, bribery or human rights abuses ó from a sugar mogul criticized for mistreating workers in the Dominican Republican to the president of Ecuador only months after that country prohibited politicians from using tax havens. South Dakota and Delaware permit ďasset protection trustsĒ that insulate wealth from claims by creditors; the mechanism lets clients dodge not only taxes but also lawful debts.

https://www.washingtonpost.com/opinions/2021/10/17/states-must-stop-letting-ultrawealthy-dodge-taxes-law/

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Reply States must stop letting the ultrawealthy dodge taxes -- and the law (Original post)
Yo_Mama_Been_Loggin Oct 17 OP
OAITW r.2.0 Oct 17 #1

Response to Yo_Mama_Been_Loggin (Original post)

Sun Oct 17, 2021, 06:52 PM

1. How hard is it to say, you don't raise taxes on the obscenely wealthy.....

you pay for the services you need.

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