The Lebanon aspect of this story has been under reported in my opinion. The guy who leaked these files was trying to sell them to the big Lebanese banks before he realized he wasn't going to profit from that. I bet he was chased out of the country and had no choice but to hand the files over to the French. But realistically, what would Lebanese banks benefit from purchasing stolen data? Nothing... If they had used the data it would have undermined their credibility... Something that many people in the region would be happy to see.
Explore the Swiss Leaks Data
81–90 of 143 posts
Re: Explore the Swiss Leaks Data
#82Earlier quoted context omitted.
Paying taxes is not "donating money". You are required by law to pay them. You get certain things in exchange, like laws that protect your property. If you think that you shouldn't be forced to pay taxes, why do you think that other laws should be enforced? If rich people steal from the state, why shouldn't poor people just take what they want from the rich? If you avoid taxes, you are stealing from everybody.
> You get certain things in exchange, like laws that protect your property. With the important difference that the price is non-negotiable, and set by the service provider alone. The people highlighted on the website chose to park their property elsewhere, so the government had zero cost in protecting that. The price is not in proportion to the quality of service at all, it's proportional to the income of the citizen…
Taxation for corporations is a very different thing from taxation for individuals. Companies pay for the privilige of doing business on the territory. I don't really think Apple Inc would be fine if they suddenly can't sell in the US, or can't employ US citizens, or can't benefit from US foreign relations.
Re: Explore the Swiss Leaks Data
#83Earlier quoted context omitted.
There's a common misconception about progressive tax systems. I'm from the Netherlands, and we've got such a system like that. But it's not true its quite common to pay over 50% taxes. For example, here we got 4 tax-discs, where you pay taxes in a disc until a certain amount of money earned(profits). Disc 1: until €19822,- : 36.50% Disc 2: until €33589,- : 42.00% Disc 3: until €57585,- : 42.00% Disc 4: more €57585,-…
those "discs" are per month? anyway, my comment was on rich people, no real definition but say earning more than 1 mil eur/ear. If I understood your description correctly, they pay around/above 50% of taxes, right?
No, these are yearly.
Re: Explore the Swiss Leaks Data
#84Earlier quoted context omitted.
Is that really true?! If so it seems that a winning strategy is to actively try to dodge the system but be prepared to pay it back when you know you'll get found out. That makes no sense. Why would that same rule not apply to other crime?
No, it is not a winning strategy as dogers have to pay a lot more due to punitive interest rates than those who correctly declared their taxes from the beginning. Furthermore, the same rule also applies to other crimes. The rule is called "innocent until proven guilty".
Arguably, the penalties aren't really punitive enough, otherwise we wouldn't still have an industry of bleeding-edge tax dodges. I know -- professionally and not closely -- one guy who specializes in complex tax mitigation for the ultra-rich. His more outre schemes may get shut down by the IRS but, if you're a client of his, you're essentially gambling tens of millions of dollars that you can avoid paying hundreds of millions in top-level taxes. At the wealth level they're at, it's a perfectly reasonable roll of the dice.
Re: Explore the Swiss Leaks Data
#85Earlier quoted context omitted.
That's ridiculous (the second part, not the "donating money" part) If you avoid taxes, you are following the law. No one should pay more than is required of him to pay. If you can structure certain transactions in different ways (e.g. 25% tax vs 50% tax), why would one choose the more expensive option? If you evade taxes, yes, then you are stealing from everybody. That I do not condone. But, there is a clear differen…
Tax laws are complex. People avoiding, not evading, taxes think they are obeying the laws. But sometimes they are using the laws in weird ways and the tax authorities might not agree. Those tax laws get tested in the courts which is a slow expensive process. Or the tax authorities will enter discussion with people using weird tax schemes to try to get some money before going to court. Tax avoidance used to mean norma…
The funny thing is that this is exactly the same fallacy programmers tend to run into when trying to game the legal system: that you're not violating the letter of the law, doesn't mean what you're doing is legal or that you can't be sued. It's not just a bunch of code.
The problem with taxation IMO is that it's caught in a vicious circle: companies / "the rich" are dodging taxes so the taxes need to be raised leading to more tax dodging and so on. Part of the problem is that tax fraud is often not punished in proportion to the actual value[0].
I don't think there's an easy solution, especially in a world that is as interconnected as ours is today.
Personally, I think income tax is a broken model because property is no longer a good indicator of wealth (it just encourages "investing" the money where it can't be taxed -- which comes with a threshold so high you end up hitting the middle and lower income households disproportionally).
Taxing the transfer of wealth more instead of its possession seems like a good idea, though. It might "slow the economy down", but with sub-millisecond stock trading being a thing I'm not sure this is a bad thing. It's not as if a huge income would be particularly useful if you aren't going to do anything with it anyway.
[0]: A recent case in Germany was Ulrich Hoeneß, the former president of the football club Bayern Munich, who was found guilty to have withheld nearly 30 million euros in taxes (after repeatedly admitting to much lower sums throughout the trial -- which to me sounds like obstruction, but what do I know). He was sentenced to three and a half years in prison, BUT an early release is extremely likely (so it's doubtful he will spend anywhere close to the full sentence behind bars) and after a mere six months he was already granted day release (meaning he can walk freely outside prison as long as he returns in the evening).
EDIT: Frankly, I'd be happy if income tax was replaced entirely by some form of transaction tax. It's far easier to reason about and far less likely to bite founders in the ass. In Germany most newly founded business go bankrupt in their third year because that's often the first time they not only have to pay tax on the previous years but also make advance payments for the current year, which can be deadly if you didn't make sure to put aside enough of your income to cover taxes (and accountants are expensive).
Re: Explore the Swiss Leaks Data
#86Earlier quoted context omitted.
What should the sales tax be progressive on? You don't know the buyer's income when they pay for stuff. Some usage taxes might work, but unless they specifically target out-of-canton persons, they will just drive more rich people out of Zurich, exacerbating the problem. At the end of the day having every 20x30 miles plot of your country independently decide on taxation is not be the best idea. Different tax regimes c…
Good point, I should clarify: A progressive sales tax not based on purchasers income, but the type of good. For example, luxury goods should be taxed higher and basic staples very low to none. This the wealthy could not avoid tax by simply shifting money around political jurisdictions. This system would encourage transparency, encourage wealth creation as well as thrift in lower and middle income earners. Also, a sid…
This kind of proposals tend to ignore how mobile wealthy people are. They might have more than one home - say, one in US, onw in Switzerland, one in Hong Kong, etc - and they might have luxury items here and there. Taxing such things with wildly different percentages is not going to work very well. The rich guys will just shop for that jewellery in Dubai and keep it in Hong Kong. Will you require him/her to declare and pay tax on it if he brings it to Paris for throwing a party there? Not likely going to work out.
Effectively, a country engaging in such tax procedures would be throwing out rich people, and while I can hear the jeers of "good riddance", I'm afraid that it's not really a good thing for tax revenues.
Re: Explore the Swiss Leaks Data
#87Earlier quoted context omitted.
> You get certain things in exchange, like laws that protect your property. With the important difference that the price is non-negotiable, and set by the service provider alone. The people highlighted on the website chose to park their property elsewhere, so the government had zero cost in protecting that. The price is not in proportion to the quality of service at all, it's proportional to the income of the citizen…
> the price is non-negotiable, and set by the service provider alone. Luckily, there are lots of different service providers. If you want to live in the low-tax heaven of Somalia, you're entirely free to do so.
Or Hong Kong, Singapore, Switzerland, Cayman Islands, Dubai, Monaco, Bahamas... just to name a few.
Re: Explore the Swiss Leaks Data
#88Earlier quoted context omitted.
Nice textbook phrases, now let's get back to the real world out there for a while. Do you even understand the simple truth, that most of the times no law is broken in tax optimalizations? Only when it does, it gets highly publitized. Usually, tax systems are full of loopholes and accountants just need to be creative enough (and yes, they are...). Without breaking any specific law, by logic "what is not explicitly for…
Nice textbook phrases. What does it matter whether laws are broken or not if the result is still people not paying their taxes while benefiting massively from society. If the best you can say about someone's behavior is that it's "not technically illegal", that's quite telling. And don't get me started on Switzerland. I live there. I'm Swiss. We have massive tax evasion. We have special tax deals for foreign national…
Is there any interest in a HN meetup in Zurich? (If yes, contact me...)
Re: Explore the Swiss Leaks Data
#89Earlier quoted context omitted.
Nice textbook phrases, now let's get back to the real world out there for a while. Do you even understand the simple truth, that most of the times no law is broken in tax optimalizations? Only when it does, it gets highly publitized. Usually, tax systems are full of loopholes and accountants just need to be creative enough (and yes, they are...). Without breaking any specific law, by logic "what is not explicitly for…
Switzerland is a tiny country with most companies being service companies that cater to foreign customers just like in Singapore. Larger countries cannot function on that kind of taxation. The cantons can individually negotiate taxes btw. so there is little need for intricate avoidance schemes. I'd argue Japan is a good example of a larger well functioning country with fair taxation (up to 40% on income above 150k US…
Japan has one of the highest corporate tax rates in the world.
Re: Explore the Swiss Leaks Data
#90Earlier quoted context omitted.
Often, the purpose of a GAAR is to stop people from setting up artificial arrangements just for the purpose to avoid tax. Let's say you sell something in the UK, and then route the money around the world to make use of loopholes in the laws of various countries, only to have the profit end up in the UK again. Transactions for business purposes are generally accepted.
Yes, but this is not easy. I heard (don't recall where) that a while back someone proposed a new tax in Sweden: "tax on work that was avoided with the intention of avoiding tax". I.e. a doctor was working 40 hours a week and was paying >50 % of income as taxes, and decided that it's not worth it to work so hard if government takes most of the proceeds, so reduced working time to 35 hours a week. The proposal was to t…
Indeed. Those kinds of situations showcase the problems of taxation that is too high, not the other way around.
It gets quite ridiculous sometimes, especially since 2008. Governments are looking for cash everywhere, and they don't mind challenging whatever comes their way.
It doesn't cost them anything to challenge arrangements, so why not try? At worst, they lose and they will have lost some time. Civil servants are being paid anyway. At best, someone pays up because they realise it's not worth the fight.
I read about a case here in Belgium where there was someone who wanted to move to Spain for non tax reasons. The tax administration levied an additional tax on some of his income, because they said his move to Spain was motivated by tax avoidance reasons. A judge ruled on the matter, saying they have no right to keep taxing someone who just wants to relocate, especially when it was pretty clear tax wasn't the motivation.
The fact is, they tried anyway, costing this guy tens of thousands in legal expenses. He was only granted a few thousand by the court as compensation.