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Author Topic: Obama announces plan to close tax loopholes: A Good Idea?  (Read 2952 times)
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oldiebutgoodie
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« on: May 04, 2009, 03:26:31 PM »

Obama announces plan to close tax loopholes

WASHINGTON – President Barack Obama vowed Monday to "detect and pursue" American tax evaders and go after their offshore tax shelters.

[...]

The president said he wants to prevent U.S. companies from deferring tax payments by keeping profits in foreign countries rather than recording them at home and called for more transparency in bank accounts that Americans hold in notorious tax havens like the Cayman Islands.

"If financial institutions won't cooperate with us, we will assume that they are sheltering money in tax havens and act accordingly," Obama said.

[...]

Under the plan, companies would not be able to write off domestic expenses for generating profits abroad. The goal is to reduce the incentive for U.S. companies to base all or part of their operations in other countries.

He said the government also is hiring nearly 800 new IRS agents to enforce the U.S. tax code.

[...]

"Nobody likes paying taxes, particularly in times of economic stress," Obama said. "But most Americans meet their responsibilities because they understand that it's an obligation of citizenship, necessary to pay the costs of our common defense and our mutual well-being."

The current tax code, he said, makes it too easy for "a small number of individuals and companies to abuse overseas tax havens to avoid paying any taxes at all."

[...]

Under existing laws, companies with operations overseas pay U.S. taxes only if they bring the profits back to the United States. If they keep the profits offshore, they can defer paying taxes indefinitely. Obama's plan, which would take effect in 2011, would change that.

[...]

Treasury Secretary Timothy Geithner joined Obama for the announcement. He said the proposals would end "indefensible tax breaks and loopholes which allow some companies and some well-off citizens to evade the rules that the rest of America lives by."

[...]

The White House said that in 2004, multinational corporations enjoyed an effective tax rate of 2.3 percent in the United States because of such allowances. Aides said that was the most recent year available for analysis.

They said the situation was indefensible.

LINK

Quote from our President from this article:   "On the campaign, I used to talk about the outrage of a building in the Cayman Islands that had over 12,000 businesses claim this building as their headquarters," Obama said.

"I've said before either this is the largest building in the world or the largest tax scam in the world. I think the American people know which it is."

Some of these huge corporations not paying their rightful share of taxes into our economy are some of the biggest recipients of the TARP bailout money. Why should they not have to pay into the system the same as the rest of us when it's that same system that handed billions of dollars over to them?
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Toler
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« Reply #1 on: May 04, 2009, 04:58:46 PM »

I guess Obama and Geithner [the tax cheat..is his name on our $ yet?] should have a word or three with congress who passed laws making tax havens legal? 
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Toler
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« Reply #2 on: May 04, 2009, 06:29:24 PM »

Sen. Max Baucus of Montana, the Democratic chairman of the Senate Finance Committee, said the plan needed further study, even though similar ideas have been around for years.

...

But [Obama] faces stiff opposition -- even within his own party -- to increasing taxes on the legal transactions of U.S. multinational companies.
http://www.freerepublic.com/focus/f-news/2244079/posts

Congress leery about Obama's plan on tax loopholes
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WhiskeyGirl
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« Reply #3 on: May 07, 2009, 06:18:02 AM »

Here are some suggestions that will return jobs to American citizens -

Close the tax loopholes that allow people in the U.S. illegally to work.  What does this mean?

I've read that some illegal people come to this country, have a baby, and get a Social Security card for this new 'citizen'.  Someone, uses that 'legal' Social Security card to get a job.  

Are these babies doing construction work?  Maybe they're working on recovery and reinvestment projects?  Maybe they are the victim of identity theft?  Is the government doing any 'reasonableness' tests?

How many of these 'citizen babies' buy houses?  Make house payments?  Collect welfare, Medicaid, Social Security, and other state benefits?  How many do this while earning high wages?

It's a simple thing to run a few queries and find some matches.

Is the government doing anything to close the loopholes?  Stamp out double and tripple dipping into taxpayer money?  Future?

If government continues to enable these acts, they make crime pay.  The flood of unauthorized people doesn't show any signs of slowing down or stopping.

E-Verify identifies people who are eligible for work.  Is that baby eligible for a construction job?  

If illegal people are discouraged from employment in the U.S., is it possible there will be more jobs for Americans and those here legally?
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All my posts are just my humble opinions.  Please take with a grain of salt.  Smile

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WhiskeyGirl
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« Reply #4 on: May 07, 2009, 06:27:25 AM »

Is it 'taxes' or 'wages and benefits' that need to be addressed?

In my mind, taxes are different from 'wages and benefits' when it comes to the level playing field.

Why do we need to tax business or Americans or build deficits?  Do foreign companies and governments tax their citizens at the American rate?  Does everyone have shared values that include wages, benefits, standard of living, wealth redistribution, to name a few important feature of 'shared values'?

Is it possible to level the playing field when not everyone on the globe shares our values?

Free trade is not fair trade. 

The Obama tax plan is apples to oranges when it comes to making a level playing field. 

In my opinion, it will ship jobs overseas in any number of ways...subcontract out the work to foreign countries, set up a shell game.

I believe this was done to our energy program in the past, the Enron and others failed.

Is Obama planning another Enron?  Sharing 'our' jobs and money in new exciting ways that benefit everyone but Americans?

My opinions.
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All my posts are just my humble opinions.  Please take with a grain of salt.  Smile

It doesn't do any good to hate anyone,
they'll end up in your family anyway...
oldiebutgoodie
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« Reply #5 on: May 07, 2009, 06:18:00 PM »

WhiskeyGirl, could you please relate your posts to offshore tax shelters (tax evasion) which is the topic of this thread? Thanks.
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oldiebutgoodie
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« Reply #6 on: May 13, 2009, 11:25:49 AM »

I found this plain question and answer that seems fairly easy to understand:

Q: How would President Barack Obama's proposal to close the loopholes on foreign tax shelters change the way companies operate overseas?

A: The May 4 proposal would not force companies to return profits from overseas to the U.S., a worst-case scenario for many company executives. Instead, Obama would stop companies from deducting expenses in the U.S. that help support their operations overseas. This would have the effect of increasing their tax burden, since companies generally are able to deduct the vast majority of their expenses.
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oldiebutgoodie
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« Reply #7 on: May 13, 2009, 11:35:01 AM »

Overseas tax shelters for US corporations a slap to taxpayers

President Obama has picked an uphill fight with his pledge to target firms that outsource jobs to foreign countries and use offshore tax havens to dodge paying taxes in America.

The president says his plan would raise $210 billion in the next decade.

It’s no secret the tax system is seriously flawed. While the average taxpayer gets a modest deduction or two, most of us have no choice but to pay the full fare.

It’s different for the big boys. One of the hallmarks of the current scheme is that U.S. firms can put off paying taxes, indefinitely, on profits earned overseas by simply not bringing it back home.

On paper, the corporate tax looks quite high, a rate of 35 percent.

Thanks to a web of breaks, incentives and dodges, the General Accounting Office estimated that for 2004, the effective tax rate on domestic income for large corporations was 25.2 percent. For multinationals’ foreign income, it was 4 percent. For the same year the Treasury Department says U.S. multinationals earned $700 billion overseas and paid $16 billion in taxes, a 2.3 percent rate.

The argument against collecting a better share of taxes is that it would cost U.S. jobs. Given that jobs are hemorrhaging even with the current cozy code, we’d say Americans are more worried about winding up in domestic homeless shelters than in policing overseas tax shelters.

The U.S. Public Interest Research Group (PIRG) notes a Senate Finance Committee Report that showed a single building in the Cayman Islands was the home for post office box tax havens for 12,000 U.S. firms. The General Accounting Office later corrected that number; it was 18,000.

President Obama noted, “That’s either the biggest building or the biggest tax scam on record.”

For the record, the building in question is five stories tall.

The administration’s arguments for targeting overseas shelters are twofold: One, it needs the money as record deficits pile atop record deficits. Two, it argues the current system rewards job creation — overseas. The president said last week, “It’s a tax code that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, N.Y.”

Does any of this matter to people here in Western North Carolina? Yes. The executive summary of a PIRG report released last month, says in part, “The debt of a few is transferred to many — and to future generations. The U.S. Senate confirmed in the recently-passed fiscal year 2010 budget resolution that the use of offshore tax havens by large corporations ‘means that honest taxpayers face a higher burden.”’

The report estimates the shortfall in corporate collections cost the nation $100 billion annually. Tar Heel taxpayers are on the hook for $2.7 billion.

The president’s proposals may be overly simplistic cast against an interconnected world economy. Certainly, steps should be taken to make sure collecting legitimately owed taxes don’t harm domestic workers.

Here’s a prediction on how this fight will play out: The people who have been pounding the drum for fiscal responsibility will suddenly vanish from the scene; a key flaw or two in the proposal will be turned into talking points that will be hammered endlessly on the talking head shows; and instead of fixing those problems, the entire proposal will be scrapped.

The reason we say this is that Obama’s proposal has been floated before. President John F. Kennedy attempted to get the ball rolling in 1961.

It’s barely budged since.

LINK
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BETH HOLLOWAY: "We will not let this go until we take Natalee home. It will never end."
WhiskeyGirl
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« Reply #8 on: May 13, 2009, 04:38:24 PM »

WhiskeyGirl, could you please relate your posts to offshore tax shelters (tax evasion) which is the topic of this thread? Thanks.

Title of thread "Obama announces plan to close tax loopholes: A Good Idea? "

"offshore" is not in the title.  I think there are many loopholes.  Onshore and offshore.
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All my posts are just my humble opinions.  Please take with a grain of salt.  Smile

It doesn't do any good to hate anyone,
they'll end up in your family anyway...
WhiskeyGirl
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« Reply #9 on: May 13, 2009, 04:45:23 PM »

ACORN/CCI

Quote
All of ACORN apparently operates under the umbrella of Citizens Consulting Inc., whose Web site is completely empty aside from its address: 1024 Elysian Fields Ave., New Orleans.

According to corporate filings, about 270 related organizations — which are a mix of corporations and non-profits from states from California to Louisiana — have filed from that location. Does that look like a building that holds 270 organizations?

The president of ACORN, Wade Rathke, is also a partner in Elysian Fieldscorp. And he and his brother Dale are listed as president or partner in dozens of companies based in that building in Louisiana.

Quote
To give you an idea of what's going on at that address as far as size and scope, compare it to the United Way. The United Way has 1,300 local organizations, while ACORN has 1,200 — so they're roughly the same size. But, we found just 13 records of affiliated organizations at United Way's main address. ACORN has two hundred and seventy.

http://www.foxnews.com/story/0,2933,519972,00.html

How many government checks have that address?  Medicaid?  Census?  How much from the TARP, recovery, and stimulus bills?  The budget?

Are these profit and non-profits working for the 'profit' of their directors?  How much do the directors and other managment make a year?

Would I choose to dig deep in my own pocket and donate money?  I'm waiting for a list of companies.

I googled the address and there is even a 'Walmart' there -

http://local.botw.org/Louisiana/New_Orleans/Wal_Mart/134142980.html
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All my posts are just my humble opinions.  Please take with a grain of salt.  Smile

It doesn't do any good to hate anyone,
they'll end up in your family anyway...
oldiebutgoodie
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« Reply #10 on: May 13, 2009, 06:27:14 PM »

For anyone who would like to set up their own offshore tax evasion scheme... LOL... 
<a href="http://www.youtube.com/v/5jtsgDBL7Mc&amp;color1=0xb1b1b1&amp;color2=0xcfcfcf&amp;hl=en&amp;feature=player_embedded&amp;fs=1" target="_blank">http://www.youtube.com/v/5jtsgDBL7Mc&amp;color1=0xb1b1b1&amp;color2=0xcfcfcf&amp;hl=en&amp;feature=player_embedded&amp;fs=1</a>
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BETH HOLLOWAY: "We will not let this go until we take Natalee home. It will never end."
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