How can we lose $400,000,000,000 a year without raising any eyebrows?

[Scuba]

[Rex]

1. Got me, it seems only the working class and retired elderly get punished

for others crimes. Makes ya wonder don't it?

[lexw]

34. Yup. Just had my unemployment cut by 17.7%.

[DonRedwood]

51. Sorry to hear that.... harsh

Kicked you while you were down.

I sometimes think they want to keep people poor and hungry. Maybe that takes away their energy to fight the system.

[liberal N proud]

2. Because everyone is more worried about welfare recipients getting something for nothing!

Politicians and companies alike all chase after the little dollars while they are letting the big dollars go without a word.

[tex-wyo-dem]

28. Yep, reminds me of a Jon Stewart quote...

Someone on DU recently posted...<Paraphrasing> basically that companies who avoid paying taxes through loopholes and sheltering money offshore are viewed as "practcing smart business" while those in need who take advantage of social programs to survive are considered moochers.

[Heather MC]

43. John Stewart also said...

"Poor people have shitty lobbyist"

I think that's the real problem

[Blue Owl]

3. The M$M won't cover it

Since M$M owners are likely among the evaders.

[indepat]

4. Can anyone but wonder if this is not basically what Congress wants, otherwise would it not

ruthlessly pursue this $400 billion annually with the all weapons in its arsenal?

[Progressive dog]

31. Well, they have been cutting funding for the IRS

I think that when Congress cuts funding for IRS enforcement, when tax collections to enforcement costs average over 4:1, the intent of Congress is clear. Congress does not want to pursue this money.

[kenny blankenship]

45. Well yes, our government is basically for show. It's a joke

and "We The People" are the punchline. For all their faults the American people don't really want an overseas empire, but we have one and they pay for it. What else can you call that but a sick joke? What else can you call it when the most profitable US based corporations often manage to pay NEGATIVE income tax, and the top officers of those corporations are typically paying a lower tax rate on their annual compensation than their secretaries?

Our wise leaders know how much money is leaking through the revenue collection net, (or if they are too deep in the bottle and forget how large the lost revenue stream is, certainly their aides in their offices and their committees know) But most of them care more about a different kind of knowledge: the fact that their careers depend in large part in never passing that kind of information on to their constituents and never proposing substantive action to recover that cash stream.

[Initech]

5. Close tax loopholes and tax religious organizations. Problem solved.

[OnlinePoker]

11. Problem is, religious organizations are the ones doing things the government should be

Like feeding and housing the poor. I know the food bank and main shelter here are done by two different religious groups. And the Sally Ann is very big on assisting the most downtrodden in the community.

[Initech]

17. How do you explain churches with 40k members and millions at their disposal?

You think those churches are out helping the poor? They probably couldn't give less of a shit about helping the poor. They're too busy complaining that Obama isn't godly enough for their taste. That's the type of institution I'm talking about.

[OnlinePoker]

21. You could say the same about unions.

They're tax exempt but are allowed to use their funds for political purposes.

[Initech]

30. Guess it's a classic catch 22.

[Progressive dog]

33. No you couldn't, union members don't get tax deductions for dues but

every penny donated to churches is tax deductible by the donor.

[OnlinePoker]

38. According to the IRS, you can.

Union Dues and Expenses

You can deduct dues and initiation fees you pay for union membership.

You can also deduct assessments for benefit payments to unemployed union members. However, you cannot deduct the part of the assessments or contributions that provides funds for the payment of sick, accident, or death benefits. Also, you cannot deduct contributions to a pension fund, even if the union requires you to make the contributions.

You may not be able to deduct amounts you pay to the union that are related to certain lobbying and political activities. See Lobbying Expenses under Nondeductible Expenses, later.

http://www.irs.gov/publications/p17/ch28.html

[Progressive dog]

40. "They're tax exempt but are allowed to use their funds for political purposes."

This is what I responded to.
Dues are only deductible only for amounts over two percent of income. Donations to religions are 100% deductible, no matter how the religion uses them.

[Heather MC]

44. Maybe Some not all. Jehovah's Witnesses Organization

have billions, and they don't even help their own. A lot of these mega churches only help Regular tithers .

I attended a mega church for 4 years the Pastor always said, don't come asking the church for money, if you have been robbing God. We will check you records

[Jamastiene]

6. K&R

[Octafish]

7. TAX IT NOW.

On My Mind

Tax Offshore Wealth Sitting In First World Banks

James S. Henry
07.01.10, 09:00 AM EDT
Forbes Magazine dated July 19, 2010

Let's tax offshore private wealth.

How can we get the world's wealthiest scoundrels--arms dealers, dictators, drug barons, tax evaders--to help us pay for the soaring costs of deficits, disaster relief, climate change and development? Simple: Levy a modest withholding tax on untaxed private offshore loot.

Many aboveground economies around the world are struggling, but the economic underground is booming. By my estimate, there is $15 trillion to $20 trillion in private wealth sitting offshore in bank accounts, brokerage accounts and hedge fund portfolios, completely untaxed.

Much offshore wealth derives from capital flight and the proceeds of past and present tax evasion. Another source is crime. At least a third comes from developing countries--more than their outstanding net foreign debt.

This wealth is concentrated. Nearly half of it is owned by 91,000 people--0.001% of the world's population. Ninety-five percent is owned by the planet's wealthiest 10 million people.

Let's tax it. The pile of offshore anonymous loot is now large enough so that even a very modest 0.5% wealth tax would yield at least $75 billion a year.

SNIP...

Is it feasible? Yes. The majority of offshore wealth is managed by 50 banks. As of September 2009 these banks accounted for $10.8 trillion of offshore assets--72% of the industry's total. The busiest 10 of them manage 40%.

CONTINUED....

http://www.forbes.com/forbes/2010/0719/opinions-taxation-tax-havens-banking-on-my-mind.html

Yeah, see. Who's left holding the bag, see.



Taxes are for the little people, see.

[ProgressiveProfessor]

8. We can redo the tax system to minimize both evasion and avoidance

However, no pol is willing to take that on.

[GeorgeGist]

9. Can't buy many politicians with food stamps.

But $400B, quite a few.

[Cleita]

10. Just a question. If it's tax evasion, how do we know the amount?

Or is it an estimate? What I'm questioning is how they arrived at that figure. It's not that I'm being snarky, but if I use it in a conversation with my Tea Party acquaintances I like to be sure of my facts.

[Southerner]

12. Yea, it's just a graphic with no link that can back it up

I'm guessing most of that $400 billion total is LEGAL deductions or loopholes.

[Cleita]

15. That would be more factual if it can be backed up somehow. n/t

[OnlinePoker]

14. Here's one study from 2011 that estimates it at nearly $500 Billion

America’s Underground Economy: Measuring the Size, Growth
and Determinants of Income Tax Evasion in the U.S
Richard Cebula and Edgar L. Feige

Abstract
This study empirically investigates the extent of non compliance with the tax code and the determinants of federal income tax evasion in the U.S.

Employing the most recent data we find that 18-19% of total reportable income is not properly reported to the IRS, giving rise to a
“tax gap” approaching $500 billion dollars. Three time periods are studied, 1960-2008, 1970-2008, and 1980-2008. It is found across study periods that income tax evasion is an increasing function of the average effective federal income tax rate, the unemployment rate, public dissatisfaction with government, and per capita real GDP (adopted as a measure of income), and a decreasing function
of the Tax Reform Act of 1986 (during its first two years of being implemented). Modest evidence of a negative impact of IRS audit rates on tax evasion is also detected.

More at link

http://mpra.ub.uni-muenchen.de/29672/1/MPRA_paper_29672.pdf

[Cleita]

16. Thanks. That's very helpful.n/t

[PoliticAverse]

20. Excellent critical thinking. Here's a wikipedia article with more explanation on the methods

used to estimate tax evasion in the US...

http://en.wikipedia.org/wiki/Tax_evasion_in_the_United_States

[Cleita]

26. Thank you, but they seem to be zeroing in on the small business and

entrepreneurs. I think the large global corporations who are doing it legally are the biggest culprits. I mean GE never seems to pay taxes.

[PoliticAverse]

29. Legal methods fall under the category of 'avoidance' rather than 'evasion'.

Of course there is some dispute as to whether all the techniques are really legal or not, but big corporations
can afford excellent legal and tax advice and lobbyists that help draft legislation with loopholes in the tax
code they can exploit.

Some recent articles discussing the legal avoidance issue:
http://thehill.com/blogs/congress-blog/campaign/166377-avoiding-taxes-the-way-big-corporations-do-it
http://www.bbc.co.uk/news/business-20580545
http://communities.washingtontimes.com/neighborhood/ad-lib/2013/apr/15/tax-day-2013-how-six-big-corporations-avoid-paying/

[Progressive dog]

22. The IRS estimates it.

"The typical tax evader in the United States is a male under the age of 50 in the highest tax bracket and with a complicated tax return. The most common means of tax evasion is overstatement of charitable contributions, particularly church donations.
In the United States, the IRS estimate of the 2001 tax gap was $345 billion.[23] For 2006, the tax gap was estimated to be $450 billion.[24] A more recent study estimates the 2008 tax gap in the range of $450–$500 billion, and unreported income to be approximately $2 trillion.[25] Therefore, 18-19 percent of total reportable income is not properly reported to the IRS.[25]"

I'm still looking for a margin of error on their estimate.

[Cleita]

24. Seems to me in the age of electronic accounting the IRS should be able to find

a way to match charitable donations to charity received without having to hire a football field of accounting clerks to do it. That would take care of that loophole anyway. Harder to trace would be trades of goods and services that don't get booked any where because no money exchanged hands.

However, I'm wondering why they are picking on the small business and single entrepreneurs when I really believe it's the big international corporations are the biggest cheaters and they do it legally.

[JDPriestly]

13. Where is the list of Americans with offshore accounts?

Has anyone seen it?

[kenny blankenship]

18. Much of that tax evasion involves revenue hiding offshore in Caribbean flyspeck islands

formerly belonging to, and still closely associated with Great Britain. Shadowy financial dealings are pretty much the only thing that remains of the once great Great British economy (Kudos, Baroness! Well done Ma'am!) This is a main and sufficient reason why even the Labour Party kept Britain out of the Euro currency union. Membership would have required the deep shadows in which British banks operate from HK to the Grand Caymans to become a great deal shorter and more revealing. British banks would have to become accountable in theory not just to the British Government, which has always kept their confidence, but accountable to foreigners! What the fuck has this to do with the finances of the US government, you may ask? LOTS. There is something we've all heard of called the Special Relationship between the US and the UK. The tip of this iceberg is diplomatic and military cooperation. Britain is like our main accomplice in the running of our empire, which we acquired, more or less intact, from them. When Bush needed someone with credibility to loan him for his Iraq War venture, he turned immediately to Tony Blair. Blair was absolutely reliable, accomodating and compliant in every way. As our No. 1 henchman, Britain gets to share in the spoils somewhat. But the main payoff to them is that we treat their little island tax haven operation with salutary neglect. This is their meal ticket -or it is for British elites- and they will do more or less anything to preserve it. US elites enjoy having not only an international ally when it comes time to apply a bit muscle to countries making trouble, but a very adept and confidential assistant in hiding their corporate profits and personal incomes from their own government. The people with real power in the US will defend Britain and our traditional arrangement with the mother country to the very last drop of a Mexican-immigrant-who-signed-up-for-the-Marines-to-become-a-US-citizen's blood. Not because their own ancestors come from Britain, but because their money goes there, on little island holidays. But even those US leadership figures who have no personal financial interest in maintaining the blind eye approach to Britain's tax "services", which deny so much needed revenue to our government, will find themselves constrained from doing too much about it. Britain is so handy to have around when we want to kick in some doors, even our "liberals" conclude that we just can't risk the symbiotic relationship between their elites and ours.

[TimberValley]

19. Does this mean legal or illegal avoidance of paying taxes?

Is the revenue not being collected because there are legal, permissible ways for some people to avoid paying taxes on certain things? Or is it that they are illegally avoiding paying taxes that they ought to?


There's a difference.

[Progressive dog]

23. Avoidance legal, evasion illegal

I'll bet that the laws were written by the avoiders.

[sulphurdunn]

35. When "they" write the tax laws

and owns the regulators, does it matter?

[DeSwiss]

25. The raising of eyebrows.....

...would suggest consciousness and/or awareness would it not?

- Do they have an app for that? That might help.....

K&R


"At a time like this, scorching irony, not convincing argument, is needed."
~Frederick Douglas

[4Q2u2]

27. We?

Who ever in their RIGHT mind thinks that must have a mouse in their pocket. I do not see anybody around here agreeing to that.
Not only are eyebrows raised but a lot of voices have been, to bad we are like the Who's in Whoville, only Horton has not heard us yet.

[bloomington-lib]

32. It wasn't lost, it was stolen, and the people with the power to stop it

are the ones helping steal it.

[midnight]

36. Holy cats.... That raises my blood pressure....

[FiveGoodMen]

37. Should be on billboards all across the country!

[Bonobo]

39. "Tax the churches. Tax the businesses owned by the churches." -FZ. nt

[TrollBuster9090]

41. I believe it was Phil 'Nation of Whiners' Gramm that originally gutted the IRS funding in the 1990s,

And the first people the IRS laid off were the high-income tax auditors, ostensibly because they were the 'most expensive.' Nice trick, Phil. Obviously, nobody looked at a cost-benefit analysis for these high end auditors, because if you get back the money from just ONE of these Cook Islands types, you've more than made up for any money you would have gotten by auditing 1000 REGULAR people, to wring another lousy $500 out of them.

So, Gramm started by making it easier for wealthy plutocrats to stash their money in Switzerland, and then pissed off to Switzerland to work for the UBS, and work the tax-avoidance racket from the OTHER end. My thought at the time was, "why doesn't CLINTON CALL GRAMM'S BLUFF, and say 'regardless of how much money you cut from the IRS's budget, WE ARE GOING TO LAY OFF THE HIGH-INCOME TAX AUDITORS LAST!. So, if your goal is to make it easier for wealthy people to cheat on their taxes, think again. We may cut some middle and lower income auditors, but the high income auditors will be the LAST to go."

But yes, this is totally ridiculous! Why is EVERYBODY talking about forcing senior citizens to eat catfood, ostensibly to 'save money,' while NOBODY is talking about going after Tax Havens and wealthy tax cheats?





Phil Gramm (not exactly as shown)

[erpowers]

42. Deficit Gone In Three Years

If the government was to get this money the deficit would be erased in three years. In ten years the country would have the $4 trillion in deficit reduction that the Simpson-Bowles commission requested. All that could be done without cutting the budgets of Social Security and Medicare.

After ten years the money could be used to build and rebuild the nation's infrastructure. The American Society of Civil Engineers has stated that the United States needs to spend about $2 trillion to upgrade its infrastructure. This extra money could more than pay for the infrastructure spending.

[YOHABLO]

46. Get Rid of Citizens United decision and private funding campaigns ..

we need people in congress who will fight for the majority not corporate America .. won't happen till this is changed. Our government has cancer.

[Recursion]

47. How much would it cost to pay the investigation and enforcement to get it?

The problem with tax evasion is you can reach diminishing returns pretty quickly.

[Scuba]

48. Well, with $400 Billion at stake, I would suggest the investigation/enforcement is a better ...

... return than most of our federal endeavors.

[Recursion]

49. That's a fair point

Here's to fully funding the IRS!

[Historic NY]

50. It makes me boil when pukes say everyone should pay.......

even those who fall threw the cracks on the poverty line don't. 1% per centers and large corporations who have the ability to pay don.t

[wtmusic]

52. It's not a few big cheaters, it's lots and lots of little ones.

Dan Ariely nails it - again.

[lark]

53. Goverment for and by the 1% creates this.

Of course it's all right if they don't pay taxes, they are the owners of everything, the little people will always take the fall. The game is very rigged.