Bush Administration Continues to
Protect Super-rich Tax Evaders
December 10, 2001
A few months ago I discussed how the Bush
administration is ignoring massive tax evasion by the super-wealthy in
offshore tax havens. Continuing its willful blindness in this area,
Bush's Treasury Secretary, Paul O'Neill (an
unabashed proponent of abolishing corporate taxes and slashing social
security and Medicare) just signed
an agreement with the Cayman Islands that seems to have just three small
things wrong with it:
- it covers only federal
income taxes, ignoring cheating on federal estate, federal gift and
state-level taxes
- it doesn't require the
Cayman Islands to start cooperating with American tax investigators
until 2004
- information about tax
evasions currently taking place in the Cayman Islands will be sealed and
can never be made available to the Internal Revenue Service or the
Justice Department (!)
Yes, you read those last two
ones correctly:
The 25-month delay gives
tax cheats ample time to move their money to another tax haven, said Jack
Blum, a Washington lawyer who specializes in financial frauds.
"They have written
this in a way so that the people who have been violating the law can get
themselves out from under the mess by moving to another jurisdiction where
there is no agreement," Mr. Blum said. "This is simply
astonishing."
"Astonishing" is
one word for it. Robert Morgenthau, the Manhattan district attorney
who has been critical
in the past about the lack of serious enforcement efforts by the Bush
administration against offshore tax cheats, has another word: "a
sham."
"What's bad is people
are going to think the government is doing something when this is just a
fig leaf," said Mr. Morgenthau, who disclosed last summer that
Federal Reserve data show that $800 billion is being held in Cayman
Islands accounts for Americans, an amount equal to roughly one-third of
all domestic bank deposits.
Mr. Morgenthau called...
for the Bush administration to cut off the Cayman Islands' access to the
United States banking system immediately, saying that was the only
effective way to end decades of tax evasion and other felonies by
Americans using Cayman Islands accounts.
Fat chance of that happening!
The Bush administration
leaves no stone unturned in its efforts to transfer wealth to the
rich. It either does so overtly -- as in its recent "stimulus
package" proposal to repeal the corporate alternative minimum tax and
retroactively refund to corporations the billions of dollars they have paid
in that tax over the last 15 years.
Or, Bush officials will do so
covertly, by signing Cayman Island-type agreements which pretend to catch
wealthy tax evaders, but which in reality allow the cheats to escape with
their untaxed billions -- while the rest of us, without the luxury of
offshore tax havens, dutifully pay our taxes and support the country.
Oh, would that the American
public would see through a Bush sham at least once!
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