Iraq Contractors, Tax Evasion, Our Candidates, and the MSM - Please Read

[Celebration]

Top Iraq contractor skirts US taxes offshore

http://www.boston.com/news/world/articles/2008/03/06/top_iraq_contractor_skirts_us_taxes_offshore/

CAYMAN ISLANDS - Kellogg Brown & Root, the nation's top Iraq war contractor and until last year a subsidiary of Halliburton Corp., has avoided paying hundreds of millions of dollars in federal Medicare and Social Security taxes by hiring workers through shell companies based in this tropical tax haven.

More than 21,000 people working for KBR in Iraq - including about 10,500 Americans - are listed as employees of two companies that exist in a computer file on the fourth floor of a building on a palm-studded boulevard here in the Caribbean. Neither company has an office or phone number in the Cayman Islands.

The Defense Department has known since at least 2004 that KBR was avoiding taxes by declaring its American workers as employees of Cayman Islands shell companies, and officials said the move allowed KBR to perform the work more cheaply, saving Defense dollars.

But the use of the loophole results in a significantly greater loss of revenue to the government as a whole, particularly to the Social Security and Medicare trust funds. And the creation of shell companies in places such as the Cayman Islands to avoid taxes has long been attacked by members of Congress.

So what, and where do our candidates fit into this equation. Well, most likely you do not know, because our mainstream media has been doggedly avoiding the issue. That is, until the very bottom of the Boston Globe article--

For decades Congress has sought to crack down on corporations that use offshore subsidiaries to lower their taxes, but most of the debates have focused on schemes that reduce corporate income taxes, not payroll taxes. Last year a Senate subcommittee estimated that US corporations avoid paying $30 and $60 billion annually in income taxes by using offshore tax havens.

Senators Carl Levin, a Michigan Democrat;

Barack Obama

, an Illinois Democrat; and Norm Coleman, a Minnesota Republican, are trying to pass the

Stop Tax Haven Abuse Act

, which would give the US Treasury Department the authority to take special measures against foreign jurisdictions that impede US tax enforcement.

However, the European press covers this issue in much greater depth. Europe is in the midst of a scandal involving the use of tax havens and some leaked documents from Liechtenstein. As an example

http://www.agi.it/business/news/200803071842-eco-ren0072-art.html

LIECHTENSTEIN: 30 NAMES UNDER SCRUTINY OF ROME'S JUDGES

http://afp.google.com/article/ALeqM5gcUrz1IqJsQLC657VihcjbxAT5zw

Liechtenstein vulnerable to money-laundering: IMF

Forbes has a story, but does not say anything about legislation or the candidates, or anything about the USA.


http://www.forbes.com/personalfinance/2008/03/04/leichtenstein-taxes-evasion-pf-tax-in_po_0304taxes_inl.html

Everybody else is doing it, so why shouldn't I? That's often been the reasoning of the super rich for stashing their money into tax haven countries.

But the idea of living in a country and not paying the same proportion of tax as most other citizens, even if you're doing it legally, is getting a bad rap, and not least because of what's happening to people who put their money into Liechtenstein.

The tiny Alpine state sandwiched between Switzerland and Austria has become the center of a media storm lately, after German authorities began raiding the homes of citizens whom they suspected of using Liechtenstein to funnel money to places like Switzerland to avoid paying taxes.

Go to Liechtenstein, and you'll find little in the way of banking infrastructure. On any given weekday, the mountainous principality can seem almost dead with inactivity. Its allure to the super wealthy is the promise to be one of the world's best keepers of secrets.

So secretive is Liechtenstein that it has become one of only three countries that do not comply with information-sharing rules handed down by the Organization for Economic Cooperation and Development (OECD). But that reputation for secrecy is now under pressure from an official German investigation into the activities of 1,400 people who kept their money in LGT Group, one of Liechtenstein's biggest banks and one that is also controlled by Liechtenstein's royal family.

The story is all over the British Press

http://www.guardian.co.uk/commentisfree/2008/feb/24/germany.globaleconomy

The wealthy have got away with financial crimes for so long they no longer regard them as crimes. When they are caught breaking the rules others must obey, they denounce the timid attempts by governments to enforce common standards as a shocking assault on a natural order in which tax is optional for those with the money to buy exemptions.

In Britain, we have seen the City in open revolt against the notion that foreign billionaires should pay a little more towards the costs of the country that protects them. Meanwhile in Germany, the decision by tax fraud investigators to... er... investigate tax fraud has turned the letters page of the Financial Times into a wailing wall for funny money men the world over.

Perhaps they are right to be alarmed. Maybe for the first time in a generation, governments are seeing the irresponsibility of the rich as a threat as dangerous to a nation's well-being as terrorism or drug trafficking and treating it accordingly. The German authorities are being admirably firm. In a sharp break from the indulgent treatment of the world's elite, Germany is paying informants, receiving stolen documents and conducting mass raids with all the vigour it would deploy against an Islamist terror cell.

The German Tax Union thinks Germany loses about €30bn (£22.5bn) a year in unpaid taxes. Much disappears into the statelet of Liechtenstein, which travel writers portray as Ruritanian idyll. True, there are charming gothic castles and it is governed by the superficially quaint Prince Hans-Adam II or, to give him his full title, His Serene Highness Johannes Adam Ferdinand Alois Josef Maria Marko d'Aviano Pius von und zu Liechtenstein, Sovereign Prince of Liechtenstein, Count of Rietberg and Duke of Troppau and Jägerndorf.

So when did this scandal get going?

http://www.businessweek.com/globalbiz/content/feb2008/gb20080219_042997.htm?chan=globalbiz_europe+index+page_top+stories

German Tax Evasion Scandal Heats Up
February 19, 2008

http://www.cnn.com/2008/WORLD/europe/02/15/deutsche.post.ap/

Fri February 15, 2008
Deutsche Post chief offers to resign amid tax-evasion investigation

LOL I love, love, love the Wall Street Journal's take on this

:sarcasm:

http://online.wsj.com/article/SB120363270597584099.html?mod=googlenews_wsj

Since last Thursday's televised police raid on his home in Cologne, former Deutsche Post CEO Klaus Zumwinkel has become a national symbol of the greedy corporate boss. Mr. Zumwinkel, who resigned the day after the raid, stands accused of evading about €1 million ($1.5 million) in taxes. Yet amid the anticapitalist backlash in Germany, and attacks on tax havens such as Liechtenstein -- where Mr. Zumwinkel allegedly hid his money -- few have taken note of the elephant in the room: Germany's Byzantine tax code and how it may encourage a collective national tax evasion estimated to be €30 billion a year.

The global elite don't want the Stop Tax Haven Abuse Act passed.

They are completely terrified that the European scandal will not be contained and will spread to the USA. Therefore, we don't read about it in our media, insofar as it pertains to our country, and anyone who promotes it gets his campaign sabotaged. Does anyone doubt that the timing of this European scandal and the concomitant nervousness of the super rich had anything to do with this --

http://www.washingtonpost.com/wp-dyn/content/article/2008/03/04/AR2008030403413.html

TORONTO -- Canada's conservative government said Tuesday it was investigating the leak of a memo that suggested Barack Obama's harsh words about the North American Free Trade Agreement were for political show.

The memo circulated within the government and obtained by The Associated Press said Obama's senior economic adviser, Austan Goolsbee, discussed the debate over free trade in the Democratic presidential primary campaign with Canadian officials in Chicago.

"The primary campaign has been necessarily domestically focused, particularly in the Midwest, and that much of the rhetoric that may be perceived to be protectionist is more reflective of political maneuvering than policy," Goolsbee was quoted as saying in the memo.

Goolsbee said his comments were misinterpreted, and Obama denied offering the Canadians any such ideas. "Nobody reached out to the Canadians to try to assure them of anything," Obama told reporters Monday in Carrollton, Texas.

Gee, I wonder how all of this relates to this story as it relates to the Clinton tax returns? --

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x4969658

STOP TAX HAVEN ABUSE