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Swiss Bank Secrecy Under Renewed Attack

kdawson posted about 6 years ago | from the havens-drying-up-like-vernal-ponds-in-global-warming dept.

Privacy 293

Stanislav_J writes "All you wealthy Slashdotters better start making alternate arrangements for stashing your millions. Switzerland's storied role as discreet banker to the world's tax-avoiding wealthy is under threat like never before, and this time the country ultimately may not be able to stop the rest of the world from prying into those legendary 'secret' accounts, said to contain between $1 trillion and $2 trillion. A massive German tax-evasion scandal is putting pressure on the Swiss to cooperate, and the rest of Europe is also hardening their resolve to force change upon them. Per the article, 'The official Swiss reaction has been self-conscious detachment, which they hope will deflate the issue,' but even their own citizens are not too concerned about those outside their borders: 80% of Swiss support the banking confidentiality law, but that number drops into the 40s when it is applied to foreigners. Pressure is also coming from US pols — not the 'let's pry into everyone's business' Republicans, but the 'make the rich pay their fair share' Democrats, including Illinois Senator (and presidential candidate) Barack Obama."

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293 comments

Secrecy is fine when it protects individual rights (5, Insightful)

stox (131684) | about 6 years ago | (#22909978)

But downright wrong when it enables someone to evade taxation like the rest of us. Striking a balance will be a difficult task.

Re:Secrecy is fine when it protects individual rig (4, Insightful)

GalacticLordXenu (1195057) | about 6 years ago | (#22910038)

You can't have it both ways. It's like trying to say "oh, secrecy is great, but not when it allows THE TERRORISTS to run amok!"--just find some reason to point out why secrecy allows some perceived ill to take place and then you can easily get rid of it for everything, because you can't have secrecy only for "good" things and "no secrecy" for "not-good" things. If you have secrecy, then yes, you're going to have people break the law to use that secrecy... and, being shielded by secrecy, people aren't going to know if you're being good or bad. Also, I see no problems people allowing people to evade taxation "like the rest of us". Why shoot yourself in the foot?!

Re:Secrecy is fine when it protects individual rig (1, Insightful)

alexj33 (968322) | about 6 years ago | (#22910058)

I'm sure that since this time it's the Democrats wanting to get into people's secrecy, it must be all just a big misunderstanding.

Re:Secrecy is fine when it protects individual rig (1)

baboo_jackal (1021741) | about 6 years ago | (#22910356)

OK, so the parent is a troll because he called Democrats hypocrites. But that doesn't invalidate the issue he highlighted:

Personal privacy is an Inviolable Fundamental Right when it protects things, people, and interests that you like. Also, personal privacy is an insignificant, trifling, legally dissoluble inconvenience when it doesn't.

So, what's the middle ground?

Re:Secrecy is fine when it protects individual rig (2, Informative)

Vellmont (569020) | about 6 years ago | (#22910122)


You can't have it both ways.

Why not? I don't think the poster said individual privacy rights were inviable. Get a warrant issued by a judge for a valid reason and the government can look at mostly whatever it likes. The only exceptions (I think) are lawyer confidentiality, and doctor/patient confidentiality.

The only difference here is that Switzerland seems to have a banker/client confidentiality, which seems a bit strange to the rest of us to throw it in with doctors and lawyers. Even that may I believe is cracked open for criminal cases, just not for tax evasion in a foreign country (which I believe isn't illegal in Switzerland).

Re:Secrecy is fine when it protects individual rig (0)

Anonymous Coward | about 6 years ago | (#22910250)

Yes there is some special law which applies for bankers, but it's mainly to protect the privacy. So they are not allowed to talk about their customers or things like that. But there is little protection from legal persecution in that.

And I find it quite funny that some people think tax evasion is not a crime.

In addition it should be mentioned, that just the system, to prevent tax evasion is different from most other countries, which makes so many people think there is none. There is a Tax of 35% on the interests you receive. This Money goes anonymously to the government and you get it back with the taxes, if you fill out to have this account.

Re:Secrecy is fine when it protects individual rig (2, Interesting)

adriccom (44869) | about 6 years ago | (#22910306)

>And I find it quite funny that some people think tax evasion is not a crime.

I'm not sure where you're from, but Tax Evasion is a founding principle of the USA
(cf Boston Tea Party, Stamp Act). It not only isn't really a crime, but it generally
respected as a virtue, at least until you get caught. Which is usually only when the
  government gives up trying to catch at something that's really a crime (cf Al Capone).

Re:Secrecy is fine when it protects individual rig (1)

polar red (215081) | about 6 years ago | (#22910652)

the problem with this reasoning is of course : the rich get to evade taxes, and the working middle class gets to pay the taxes(which are higher for them because someone needs to pay for roads, education, police, military, ...).

Re:Secrecy is fine when it protects individual rig (1)

jcr (53032) | about 6 years ago | (#22910702)

the rich get to evade taxes

Rich people don't have to evade taxes, they can afford to buy politicians to manipulate the tax code for their benefit.

The reason for the Byzantine complexity of the US tax code is that it is the result of nearly a century of politicians selling favors to contributors.

-jcr

Re:Secrecy is fine when it protects individual rig (5, Interesting)

Spliffster (755587) | about 6 years ago | (#22910348)

"The only difference here is that Switzerland seems to have a banker/client confidentiality, which seems a bit strange to the rest of us to throw it in with doctors and lawyers. Even that may I believe is cracked open for criminal cases, just not for tax evasion in a foreign country (which I believe isn't illegal in Switzerland)."

I am swiss. Tax evasion is illegal in switzerland by law but the banking secret usually makes it impossible to track it down. Most swiss people have not much of a benefit about this banking secret. It's the foreigners with shitloads of money which profit (we won't see tax for their illegally stored money neither) but we get into loads of troubles in foreign affairs (politics).

It's still not understandable to me why a country has to protect a private industry by law to make breaking the law possible. the only ones which benefit from this are the banks. The ones which loose because of it are the people.

About damn time to get rid of this law.

kind regards,
-S

Re:Secrecy is fine when it protects individual rig (1)

cocotoni (594328) | about 6 years ago | (#22910730)

Evasion of Swiss taxes is illegal in Switzerland, but not evasion of foreign taxes. And that is all well with me. The countries that cry foul should go after their own citizens, based on the books in their coutries (there has to be a trace that the money is paid) and not rely on other governments to do the work for them. How deep should the bank go while checking if the taxes have been paid?

Switzerland goes so far as to collect the taxes for USA and EU on further profits on the money in the banks (taxes calculated on the interest rate gains), I don't think that any other "tax haven" goes that far. The banks just don't ask if the foreign taxes have been applied to the money coming in. Does it stink?

And Swiss are profiting from these accounts - the Swiss taxes are applied to profits made by the banks while re-investing the money.

So the only ones losing are the foreign governments that have all the right to go after their citizens' money, but that doesn't give them any special rights in my bank.

[disclaimer: I live and work in Switzerland, have an account in a Swiss bank, and while living and working in Switzerland I think it stupid to pay taxes to any other country]

Re:Secrecy is fine when it protects individual rig (5, Insightful)

Anonymous Coward | about 6 years ago | (#22910774)

Well, I'm not Swiss, but I worked at all the major banks in Switzerland (and work in one presently).

The bank secrecy has been a boon to the Swiss banking industry. Make no mistake, not only has this created jobs, but it also works as a "Sozialamt", because a bank will employ up to five people (mostly Swiss, of course) to do the job of one single person, all the while the five will whine how "overloaded" they are.

If the Swiss banks didn't have the banking secrecy laws, at miserable (and laughable) 1.85% interest, it wouldn't be interesting to siphon money into Switzerland, so about four in five of your countrymen wouldn't have a job, and couldn't take their expensive vacations two to three times a year!

As expensive and as inefficient and as bureaucratic as things are in Switzerland, what do you think, where did the money come to pay for this huge, inefficient system come? From foreigners siphoning money into Swiss banks because of the secrecy laws!

So if Confederatio Helvetica abolishes bank secrecy laws, Switzerland will be severely busted.

How then are you guys going to pay for those 2-5 expensive vacations per year? And where are the other four guys going to go? Let me remind you, your conuntrymen consider themselves above menial jobs, like the Baustelle, or Kellner...

Re:Secrecy is fine when it protects individual rig (2, Insightful)

Spliffster (755587) | about 6 years ago | (#22910880)

Well, I personally think the wealth in our country can be attributed to many things, one of them are banks which made some people super rich, this inflates the statistics. There are huge tax cuts for rich people, this is why some many foreigners officially live here, that's another reason statistics are inflated.

IMHO the wealth mainly comes from my parent's generation. the after WWII generation(s) has been working hard, this has changed.

I hear the argument "if we give up banking secret we will loose many jobs" for a long time. this is the main argument of the supporters. Problem is; although the banking industry is large (compared to other conuntries) it is still very small compared to other industries. Because they are multinational companies, only a (small?) part of their employees works in switzerland. There are companies which actually produce something, these companies employ the majority of people.

However, you are right. Abandoning the banking secret will have an impact, banks would move on and some people will loose their job or would move with the company.

The problem is, on the other hand, we get constantly in trouble about the banking secret, paying punishment tax which are not necessary. Instead of paying these tax to foreign countries, we could pay the unemployed instead.

After all, I believe it when I see it. Banking secret will not be given up so quickly (it is beeing debated in the media every 5 years or so since i am alive). It has been a "problem" for decades, banks make a lot of money, have a strong lobby. I highly doubt this will happen now.

Kind regards,
-S

Re:Secrecy is fine when it protects individual rig (1)

diewlasing (1126425) | about 6 years ago | (#22910782)

Actually you will see a tax. I'm pretty sure the Swiss. gov. charges 35% tax on all interest earned in Switzerland banks to foreigner. But they can recover 30%/35% they pay if they claim it and basically give up their identity.

Re:Secrecy is fine when it protects individual rig (0)

Anonymous Coward | about 6 years ago | (#22910914)

> About damn time to get rid of this law.

Interesting.. you want to commit financial seppuku just because the Germans think that its morally objectionable to protect the individual against the greed and huge capital expenditure requirements of the nanny state?

I would say that you have grown fat, spoiled and lazy. Do things your way and the 1/3rd of the global capital will move instantly from Switzerland, to one of the other states that have chosen to side with the individual against the state.
Luckily not many swiss will agree with you.. which is why I still live in Switzerland.
Give up your banking secrecy and I will be gone in 5 seconds flat.. might just jump across the border to Austria.. or Luxembourg, or Monaco, or Liechtenstein, or Dubai, or Singapore, or Panama, or ... I can just put my money in Delaware, USA - one of the least regulated tax havens in the world.

Choosing not to compete in the global marketplace does not insulate you from failure - only from success, and your children will be the ones paying the price.

Oh but you can. (2, Interesting)

plasmacutter (901737) | about 6 years ago | (#22910126)

Wall streeters and corporate types who engage in tax evasion and other financial crimes of this level do their dirty work through corporate subsidiaries.

Corporations should not be entitled to "human" rights.

The myth of corporate personhood needs to be firmly put to rest. Either that, or limited liability should end when you have the power to make major unilateral decisions within that firm.

Re:Secrecy is fine when it protects individual rig (1)

Asic Eng (193332) | about 6 years ago | (#22910482)

I don't think secrecy and fair taxation are generally incompatible. There is no need for the government to know how much money you have, in order to get their share - provided the banks deduct that share and transfer it to the government directly. So the swiss banks would need to add information to the account which states where the account holder is liable to pay tax, and which percentage of the interest that is. They would directly transfer that money where it belongs, and the account holder can use the bank's account statement to claim deductions where applicable.

A system like that was already proposed once in Germany ("Quellensteuer") unfortunately the government at the time was too weak to actually implement it. There were attacks from the right ("people will move their money abroad" - so what, they are not paying taxes now) and from the left ("little old ladies will have to pay tax on their savings" - they could claim it back, and if the amount is significant then they _can_ pay tax).

Re:Secrecy is fine when it protects individual rig (3, Insightful)

rtb61 (674572) | about 6 years ago | (#22910052)

Even worse when it is not simple tax evasion but the proceeds of crime. Swiss banks profiting based upon the suffering of others, from Despotic leaders, to organised and of course including your typical everyday bribe taking politician.

The Swiss economy is basically subsidised by victims from the rest of world.

Re:Secrecy is fine when it protects individual rig (-1, Flamebait)

timmarhy (659436) | about 6 years ago | (#22910162)

what a total load of fucking crap. go back and smoke some more dope and dream up another paranoid delusion.

Re:Secrecy is fine when it protects individual rig (0, Troll)

Heembo (916647) | about 6 years ago | (#22910262)

Dude, the poster is correct. Google "swiss bank nazi gold", "swiss bank terrorism" etc. The Swiss bank system has a very long history of privately holding large sums of money for scumbags.

Re:Secrecy is fine when it protects individual rig (2, Insightful)

adriccom (44869) | about 6 years ago | (#22910314)

Let me fix that for you:

sed -i s/scumbags/politically disadvantaged minorities/ $GP

There, that's better.

Either privacy of commerce is a right or it isn't. If you really want to give that right up, I'm sure there are plenty of governments that would appreciate it and might even give you a sticker or a stamp to replace that pesky liberty you relieved yourself of.

Re:Secrecy is fine when it protects individual rig (4, Insightful)

Heembo (916647) | about 6 years ago | (#22910322)

Tax evasion is not Liberty - it's criminal activity. Responsibility and accountability comes with this thing "Liberty" you toss around so haphazardly.

Re:Secrecy is fine when it protects individual rig (1)

Clay Pigeon -TPF-VS- (624050) | about 6 years ago | (#22910164)

There you go, attempting to apply natural law to everything.

Just because something is unethical or immoral or makes your stomach churn doesn't mean it is illegal where and when it is happening.

Twofo plugged in the butthole (-1, Troll)

Anonymous Coward | about 6 years ago | (#22910110)

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Fact: Twofo trolls are dying

Re:Secrecy is fine when it protects individual rig (2, Informative)

Anonymous Coward | about 6 years ago | (#22910114)

But downright wrong when it enables someone to evade taxation like the rest of us. Striking a balance will be a difficult task.
I don't think it will be that difficult to do. Nobody is pressuring Switzerland to give up the privacy of Swiss banks for Swiss citizens. They are pressuring Switzerland to give up the privacy of Swiss banks to foreigners who are evading their national laws. Countries like Germany, France, the United States, and the United Kingdom don't feel that it is a privacy right for you to hide your income and assets from the government to avoid taxation. Switzerland does.

There is no question this is unethical. Switzerland is profiting from these investments and other countries are having to pay the bill (both monetary and socially). It is no surprise that criminals and criminal organizations have used this loophole to continue their practices. Switzerland's practice is hurting these other countries in a very real way. If they want to continue granting this right to their citizens, fine. But they do not have some privacy right to extend this practice unethically to foreigners.

Re:Secrecy is fine when it protects individual rig (1)

Rakishi (759894) | about 6 years ago | (#22910132)

That assumes you find all the laws of those countries to be ethical. Someone who is, for example, fighting against oppression in their own country may disagree without on that issue.

Legality and ethics are not equivalent.

Re:Secrecy is fine when it protects individual rig (3, Interesting)

Anonymous Coward | about 6 years ago | (#22910192)

Do you honestly think Switzerland is implementing these privacy provisions to protect oppressed foreigners? Or do you think that they are doing it for their own profit?

We have two ethical issues that need to be resolved here. The first is the right to privacy of your income and assets from your government. The second is the motivation of Switzerland's bank privacy provisions.

In the first case you will need to argue that a person has a right to protect income and assets from their government. In my opinion, it is ethical for the government to be able to examine income and assets for taxation purposes. I base this on an argument of comparable moral values. However immoral it is to tax the rich at a higher rate than the poor is balanced out by two factors: (1) the rich created their wealth through a society that has good health, education, and infrastructure, and (2) the overtaxing of the rich causes a lower personal burden for them than equal taxing of much larger numbers of the poor and middle class. I'm not arguing for a massive redistribution of wealth, only that the poor and middle class have a chance at a decent quality of living and that there is a decent chance for an individual to change his or her social class.

Even if you don't agree with my argument for the first case, you will still have to sustain the morality of the second case. I would argue that their inflated GDP per capita (about 30% higher than their neighbors) is not based on superior government or natural resources but on their financial institutions which have gained an incredible competitive advantage due to their laws. I would also note that Switzerland taxes its rich much higher than they tax their middle class or poor which would undermine a Swiss moral argument against the first case.

Re:Secrecy is fine when it protects individual rig (1)

Rakishi (759894) | about 6 years ago | (#22910224)

I really wonder why people make so many assumptions about posts. I mean is the world that black and white to you, is it impossible to question something unless you rabidly hate it, must everyone hold the party line unwaveringly? I simply said that there is an ethical dilemma thus a trade off involved. I didn't say which side I support, I didn't say which way the tradeoff goes in my opinion but simply that there is one involved.

I simply think that anytime you lose any privacy such a tradeoff exists and should be considered. It's not about the government now in a country covered with rights and freedom. It's the government in the future, when it finally collapses into a power hungry corrupt mess, or in an existing country that makes feudal Europe look freedom filled.

Re:Secrecy is fine when it protects individual rig (0, Insightful)

Anonymous Coward | about 6 years ago | (#22910382)

I really wonder why people make so many assumptions about posts. I mean is the world that black and white to you, is it impossible to question something unless you rabidly hate it, must everyone hold the party line unwaveringly? I simply said that there is an ethical dilemma thus a trade off involved. I didn't say which side I support, I didn't say which way the tradeoff goes in my opinion but simply that there is one involved.

I simply think that anytime you lose any privacy such a tradeoff exists and should be considered. It's not about the government now in a country covered with rights and freedom. It's the government in the future, when it finally collapses into a power hungry corrupt mess, or in an existing country that makes feudal Europe look freedom filled.
How ironic. You are making the same assumptions about my post that you claim I am making about yours. Read my post again. I didn't express rabid hate nor did I assume you supported a single side. Any assertions that you took were open ended questions marked by question marks such as "Do you honestly think Switzerland is implementing these privacy provisions to protect oppressed foreigners?" Afterwards I discussed the ethical issues involved like you wanted in this post. The question I need to ask you now is have you read the post or have you mistakenly responded to another post?

If you responded to the correct post it is absolutely essential that you cite how I think that it is "impossible to question something unless you rabidly hate it" or how I think that "everyone [must] hold the party line unwaveringly".

Re:Secrecy is fine when it protects individual rig (2, Insightful)

DavidShor (928926) | about 6 years ago | (#22910178)

"But they do not have some privacy right to extend this practice unethically to foreigners."

Do we have the right to unethically extend freedom of speech to foreigners? The right to banking privacy is considered a defense against government tyranny, just as Free Speech.

While I personally think that the cost's of banking privacy do not justify the benefits, that is a discussion for the Swiss. But while they hold these values, they have just as much right to hold the rest of the world to their values as we do to ours.

Re:Secrecy is fine when it protects individual rig (0)

Anonymous Coward | about 6 years ago | (#22910120)

One might say secrecy is fine when it protects individual rights, but downright wrong when it enables terrorist. You can't have your cake and eat it too.

Re:Secrecy is fine when it protects individual rig (3, Insightful)

atomic brainslide (87546) | about 6 years ago | (#22910878)

Oh, won't someone PLEASE THINK OF THE TERRORISTS!

geeze. i can't believe how blind some people are. as has obviously been pointed out before, the Swiss provide a financial anonymization service. they have removed their own imperfect judgement of what constitutes right and wrong and simply act in good faith for their clients. yes, sometimes this system is abused (nazi gold and various tax evasion schemes, etc), but the principles of the system are no different than you wanting privacy for all users of the internet, for wanting secrecy in your instant messaging systems, deniability, the rights to use the Internet for whatever purpose you choose. the issues here are all the same. some people will use the system for the benefit of the public good while others will use it for their own selfish purposes at the expense of the public good.

if the "good guys" haven't caught on to the fact that they can exploit the system the same way as the "bad guys" then it's only their fault for missing the opportunity.

Re:Secrecy is fine when it protects individual rig (1, Funny)

Anonymous Coward | about 6 years ago | (#22910160)

...wrong when it enables someone to evade taxation like the rest of us. Striking a balance will be a difficult task.

Yes, this is very true. I mean (unless everything tv taught me is wrong) when it comes to the ol' "where to stash yer cash" dilemma, there's never an easy answer, and somebody always ends up unhappy. just look at the never-ending feud between Jed Clampett and Granny. Now, Granny had a much more sophisticated approach than most would give her credit for: her periodic insistence that Jed go to Mr. Drysdale's bank and withdraw all their bubblin'-crude-turned-to-cash-money riches would have allowed the Clampetts to avoid those damn revenuers, all without her ever having to go through the trouble of leaving her posh beverly hills shack and tote all those silver pieces (not any of that funny paper money) to Switzerland. I'd say that a cee-ment pond filled with silver pieces would offer plenty of untraceable, tax-free secrecy.

doesn't seem difficult (1)

nguy (1207026) | about 6 years ago | (#22910422)

Privacy need not include how much money you have in the bank, how much money you earn, how much money you inherit, and/or how much money you spend. Personally, I think all those pieces of information should not just be available to the government, but to the public, by name. An efficient, free market really requires that information to be public anyway.

Re:Secrecy is fine when it protects individual rig (1)

Plutonite (999141) | about 6 years ago | (#22910680)

But downright wrong when it enables someone to evade taxation like the rest of us.
We all.. evade taxation? Not me you insensitive clod! And what is this slashdot-exclusive tax evasion scheme you are talking about - did I miss an important Ask Slashdot or something? I feel very alienated right now. I want to be with you guys.

Re:Secrecy is fine when it protects individual rig (1)

jcr (53032) | about 6 years ago | (#22910686)

There's no balance to strike: either we're entitled to privacy, including privacy of our financial matters, or government power is total. I know which I'd prefer.

-jcr

Re:Secrecy is fine when it protects individual rig (0)

Anonymous Coward | about 6 years ago | (#22910740)

Apparently you prefer false dichotomies.

No worries (5, Funny)

Anonymous Coward | about 6 years ago | (#22909980)

I've stashed my millions in virtual banks and real estate in Second Life. There's no way that can turn out badly.

read the fine print/research the story first (3, Informative)

Anonymous Coward | about 6 years ago | (#22909994)

It's not so much about the banking laws n Switzerland proper, it's more about Lichtenstein and their completely anonymous foundations. Plus the fact that Lichtenstein (not Switzerland) does not consider tax evasion even a crime, so good luck to get them to tell you anything.

Worse or better, the scandal is already slowly declining. (Basically it has dropped from the news, or at least the front page of newspapers. E.g. the issue of getting rid of Mr. Beck, the party leader of the SPD seems to be way more interesting currently)

yacc

Let me be first (1)

William Robinson (875390) | about 6 years ago | (#22909996)

All you wealthy Slashdotters better start making alternate arrangements for stashing your millions

To offer the slashdotters to hand over the money to me and just forget it.

How about these people, including my fellow dems.. (2)

plasmacutter (901737) | about 6 years ago | (#22910022)

Get the regulations in their own nations properly attuned first.

Especially in the US, where businesses, media outlets, and telecoms have been increasingly 'freed' of regulations necessary for the maintenance of the public good since reagan took office back in the late 80's.

This includes but is not limited to finances.

(my first priority would be the media ownership regulations, the removal of which has resulted in the formation of the largest political propaganda machine since hitler's information ministry)

Re:How about these people, including my fellow dem (0, Flamebait)

GalacticLordXenu (1195057) | about 6 years ago | (#22910046)

"Maintenance of the public good", I see a socialist right there.

Re:How about these people, including my fellow dem (1)

plasmacutter (901737) | about 6 years ago | (#22910074)

"Maintenance of the public good", I see a socialist right there.


this veiled assertion that conservatives are against the maintenance of the public good seems a bit inaccurate to me.

Re:How about these people, including my fellow dem (1)

Idiomatick (976696) | about 6 years ago | (#22910176)

Conservatives are often linked with libertarians. Libertarians whole heartedly do not care about the public good. So i don't see why the assertion is so wrong. Also what he said was socialists are for the common good ... seems obvious with a name like SOCIAList. (Also feel free to note CAPITAList has not to do with a big city but capital as in money).

Re:How about these people, including my fellow dem (4, Insightful)

jcr (53032) | about 6 years ago | (#22910714)

Libertarians whole heartedly do not care about the public good

That's a rather vicious smear, not to mention being a baldfaced lie. Libertarians care far more about the public good, particularly about our freedom, than those on the right or left who constantly seek to increase the power of the government. We've noticed that the freer we are, the better off we are.

-jcr

If it's small enough, take it over already. (1, Troll)

sethstorm (512897) | about 6 years ago | (#22910036)

Just declare each "tax haven" a terrorist country and get on with it. While you can't just raid enough banks and stock exchanges here in the US without someone noticing, that would come close.

They may have gotten Spitzer, but Wall Streeters (no, that doesnt include pension/mutual funds) need to know about the rules. When they violate said rules, they should feel something large enough not to pass on, and something they must face directly as those of Main Street face.

Re:If it's small enough, take it over already. (1)

eean (177028) | about 6 years ago | (#22910146)

Or you can just essentially make them a part of the European Union with a series of bilateral agreements.

Bankers (1)

strack (1051390) | about 6 years ago | (#22910064)

Man. I really hope this succeeds. I always get a warm fuzzy feeling whenever a lot of bankers hit the wall.

Re:Bankers (1)

plasmacutter (901737) | about 6 years ago | (#22910102)

id rather see bankers required by interpol to stay open until 1 hour after normal work hours cease.

I think their current workday involves everyone walking in the door, clocking in via the phone in alphabetical order, clocking out via the phone in alphabetical order, then going out to the pub down the road before returning to WoW.

Reality mirroring Science Fiction (3, Interesting)

TFer_Atvar (857303) | about 6 years ago | (#22910068)

In "Earth," by David Brin, there's actually a big campaign to uncover all those secret bank accounts, and the whole situation devolves into a war against Switzerland.

Re:Reality mirroring Science Fiction (4, Funny)

Faylone (880739) | about 6 years ago | (#22910096)

A war against Switzerland?! That's crazy! They can do ANYTHING with just their pocketknives!

Re:Reality mirroring Science Fiction (3, Insightful)

rve (4436) | about 6 years ago | (#22910186)

I know you're just joking, but switzerland is actually armed to the teeth. Everyone there is armed, most men train or have trained for the militia. They're obviously too small to fend off a super power, but definitely tough enough to make an invasion not worth it.

Re:Reality mirroring Science Fiction (1)

Sique (173459) | about 6 years ago | (#22910312)

The last time Switzerland had to fend off a super power they were also considered too small to make it.

But alas, this is now 531 years ago, when in 1477 they fend of Karl the Brave from Burgund with the largest armored knight army of its time and caused the end of Burgund as a state in the Battle at Murrgarten.

Re:Reality mirroring Science Fiction (1)

poopdeville (841677) | about 6 years ago | (#22910408)

Uh, Germany would have loved to take them... but it would have been a ridiculous idea politically -- in particular, since other 'neutral' powers like the US would have jumped in.

Re:Reality mirroring Science Fiction (0)

Anonymous Coward | about 6 years ago | (#22910518)

...Not to mention their crack Navy...

Re:Reality mirroring Science Fiction (0)

Anonymous Coward | about 6 years ago | (#22910700)

Also, some of our Cheese can be considered biological weapons...

Re:Reality mirroring Science Fiction (0)

Anonymous Coward | about 6 years ago | (#22910352)

Especially as they also have the swiss army fighter. At least they had some in Amiga 500 times.

Rotary club members seem a tad naieve.. (5, Insightful)

Vellmont (569020) | about 6 years ago | (#22910100)

This statement actually surprised me:

During a meeting of his Rotary Club in Zurich, his fellow members were appalled that Swiss bankers might be managing the money of foreign tax evaders. "We had no idea," Mr. Hummler recalls them saying, "that you did things like that."

I don't pay a hell of a lot of attention to financial news, or banking laws.. but even _I_ know that the Swiss have built a long reputation on providing accounts to foreigners trying to avoid taxes in their home country. Isn't this just common knowledge? I'd think it'd be even more common knowledge in Switzerland.

Re:Rotary club members seem a tad naieve.. (1)

youthoftoday (975074) | about 6 years ago | (#22910270)

OK this isn't a troll it's a serious point.

From what I gather, most Americans aren't aware of what their troops are doing overseas. Whilst most of the population is protected from the news by news agencies, the rest of the world comes to see America as synonymous with torture, human rights abuses, corruption etc. Most people inside the country don't see it in the same light as outsiders.

Surely it's possible that the same thing happens in Switzerland? Yes, it's notorious across the world for nazi gold and contemporary cash in search of a tax haven. But that doesn't mean everyone inside knows what's going on?

Obviously I'm playing devil's advocate, of course they know. But the argument still stands.

Re:Rotary club members seem a tad naieve.. (0)

Anonymous Coward | about 6 years ago | (#22910336)

Actually, much of the American press is anti-war so we get to hear plenty of the torture and abuse stories. However, we recognize it's crap and see the same few reports (fake and real) echoed repeatedly. What our troops are doing overseas we can learn from the thousands of returning troops; if abuse were so widespread there would be even more stories.

Re:Rotary club members seem a tad naieve.. (1)

youthoftoday (975074) | about 6 years ago | (#22910398)

Sure maybe now. But look back a few years. I remember asking a friend in NY and being appalled how shielded she and others.

Anyway that wasn't my point.

Overblown, Switzerland will do fine (5, Informative)

ivec (61549) | about 6 years ago | (#22910124)

Yes, Switzerland has a long tradition of bank secrecy. Here it is considered a natural part of one's right for privacy.

But among the many tax havens (http://en.wikipedia.org/wiki/Tax_haven#Examples), Switzerland is among the best world-citizens: while it still offers secrecy, it has had for several years agreements with the US and the European Community to tax capital income from foreign citizens. The principle is: we preserve secrecy, but we will tax the funds for you.

For money laundering too, Switzerland offers one of the highest levels of scrutiny from the countries above.

Given the number of alternatives, it is not in the interest of the international community to shut down Switzerland.

In Europe alone, Luxembourg, Austria and Malta offer similar levels of secrecy. And it is not in Europe's interest to shut its internal secret- and law-abiding banks.

So the whole story is overblown. Is it just anti-marketing against Swiss banking?

This said, the current affair relates to Lichtenstein - an independent state attached to Switzerland like Monaco is attached to France. Like Monaco, this "small rock" of a state is known to have more lax practices. It would not hurt to take some balancing action there.

[Disclaimer: I'm a Swiss citizen, but have no vested interest in any Swiss bank - I'm a worker/small entrepreneur in the medical/software industry, not a capitalist nor an investor (I do not even play on the stock market). But like many citizens here, I see bank secrecy as just another facet of privacy, which is not incompatible with fair taxation and a fair social system.]

Re:Overblown, Switzerland will do fine (2, Funny)

UnicornRider (1107729) | about 6 years ago | (#22910388)

From my experience as former junior executive of a Swiss (not: Lichtenstein) bank, things are as simple as that:
In consequence of an obsession with cleaning, Swiss have to launder everything within reach - including money.

Re:Overblown, Switzerland will do fine (2, Insightful)

AnthonF (1204808) | about 6 years ago | (#22910484)

There is a tax evasion crime in germany that reached the media and now is a 'scandal', that crime is linked to one of those 'law abiding banks' so how can you assure they are law abiding accounts if they are under secrecy?

Now Mr. Hummler says "What is going on is a power play,... so what? is that supposed to be a valid excuse to protect a criminal investigation? Just because economic "powers" are involved? Economy is the root of all crimes! No one commits it as a hobby.

Privacy and Foreign Accounts (1)

superbrose (1030148) | about 6 years ago | (#22910586)

Here are some good reasons why slashdotters would want to put their money into a foreign bank account, even if they can't evade paying capital gains tax in their own country, and even if they can't use their account for money laundering:

  • They want to have added financial security by spreading their money across different banks and countries in case of a crisis
  • The banking system in their own country is too unstable to be trusted with their own savings
  • The country they live in may have an unstable regime and they don't want to wake up one day with nothing
  • The country they live in may currently have a stable regime, but they want to protect themselves from future political changes
  • They don't trust their government

Island Paradise (0)

Anonymous Coward | about 6 years ago | (#22910138)

I know a few "Offshore Banking Representatives" and none of them deal with Switzerland, they all operate out of island nation areas (Doesn't take a wild imagination to work out which part of the globe I'm talking about)

tax burden myths (1, Insightful)

timmarhy (659436) | about 6 years ago | (#22910156)

One myth that people keep repeating is that the wealthy don't pay tax.

the fact is this is total bullshit, the top 1% in america pay almost 50% of the tax, and avoiding this is IMPOSSIBLE. and the reason it's impossible to dodge is tax departments around the world have these nice little laws which allow them to investigate you and tax you based on what they THINK you should be paying. so hiding offshore does them fuck all good

http://www.rushlimbaugh.com/home/menu/cy2003.guest.html [rushlimbaugh.com]

Re:tax burden myths (0)

Anonymous Coward | about 6 years ago | (#22910180)

Why is the parent modded offtopic?

Re:tax burden myths (5, Informative)

vux984 (928602) | about 6 years ago | (#22910296)

One myth that people keep repeating is that the wealthy don't pay tax.

And it would be a myth if it weren't true...

http://www.nytimes.com/2005/07/03/business/03tax.html?_r=1&oref=slogin [nytimes.com]

"About one in every 436 high-income Americans paid no taxes in 2002, up from one in 531 in 2001 and one in 1,010 in 2000."

the fact is this is total bullshit, the top 1% in america pay almost 50% of the tax

Actually, its the two 2% paying 53% (which is also in the cite I provided). But close enough.

The trouble however, is that a middle class american pays 30-35% in taxes, while a high-income american pays, on average only 18%.

So sure, if you make 146M bucks, yeah, your paying $26M in taxes. But if you take 1460 families that each make $100,000, that's the same 146 million in aggregate, but they each pay ~33k in taxes on average,... or 48M in aggregate.

Why do they pay 48M when you only pay 26M?

The high-income earners have considerable income from 'investments' not just 'wage/salary' which is taxed differently and wage income has far fewer loopholes and options than investment income, and there are countless more ways to leverage your money too the more you've got to shuffle around to maximize tax savings.

They're more likely to be 'self employed' at least with respect to some investment or other and suddenly that trip to the bahamas is a tax deductible 'annual meeting' instead of a 'vacation', and the twice yearly jaunts to Mexico? Tax deductable trips to inspect their investment rental properties....

Their car? Tax deductible lease payments, maintenance, and fuel... Their mortgage? Bah, who are we kidding they don't have a mortgage, but they do have a HELOC to buy even more investments, and the interest on the HELOC? Because its being used to buy goverment approved investments...you guessed it... tax deductible. The tax savings more than offset the interest, meanwhile the investments themselves can make money too.

The wealthy pay more taxes than the middle in total, but its the ones in the middle who see the largest chunk of each dollar bitten off by the IRS never to be seen again.

Re:tax burden myths (1)

mhermans (948710) | about 6 years ago | (#22910736)

I find it also interesting to look at the link between taxation and welfare systems. To simplify: in liberal welfare regimes (US, UK) there is relatively litte taxation of the middle and (especialy) higher income groups, and little redistribution to the lower groups. In continental welfare regimes (Belgium, Germany, ...) the middle group get taxed more heavily, and there is more distribution to the lower, but the highest income group gets left alone (still more taxation then in the US&UK). In the Scandinavian model, there is the largest amount of redistribution, but the brunt is carried by the highest income groups, while the taxation of the middle group is relatively low--not a bad setup, seem from an egalitarian & economic perspective...

Re:tax burden myths (1, Insightful)

Anonymous Coward | about 6 years ago | (#22910300)

Yeah, but how much wealth does that top 1% control? I don't think I'm too worried about them being taxed proportionally to the rest of us, or even disproportionately. If you've got a billion dollars, I think you can afford to pay a little more to support the government that bails you out (and not the poor) when the mortage market busts.

Singapore? (2, Informative)

Futurepower(R) (558542) | about 6 years ago | (#22910168)

I read an article that claimed that Singapore was trying to position itself as the new bank secrecy country.

Re:Singapore? (0)

Anonymous Coward | about 6 years ago | (#22910768)

Not correct.
Singapore is positioning itself to be an international banking center, but based on service, not on secrecy.

worst. summary. ever. (4, Informative)

0WaitState (231806) | about 6 years ago | (#22910184)

Between the rambles, the cliches, the sudden topic changes, somewhat fractured grammar, the dubious attempts to apply American political stereotypes to Switzerland, this has got to be the worst summary I've ever seen on slashdot. Even Michael or Zonk on (hypothetically) quaaludes could have done better.

slashdot users are fucking bastards (-1, Troll)

Anonymous Coward | about 6 years ago | (#22910194)

You are all fucked up nerds who deserve to have their penises sliced off.

I don't give a $*&%$ about the Swiss.... (2, Interesting)

EdIII (1114411) | about 6 years ago | (#22910202)

This is not really about the Swiss as much as it is about Privacy and Tax Evasion. The fact it occurs in Switzerland is incidental. If the ability for foreigners to maintain private bank accounts was eliminated in Switzerland tomorrow, it would just move some place else.

Everybody has always known that Switzerland is used for tax evasion. From the very very beginning, since we started doing income taxes in the US. I am not sure about cultures in other parts of the world, but in the US it became "public knowledge" a long time ago. Just recently I was watching an episode of MASH on TV, which was filmed in the 70's and set in the 50's where Switzerland and Tax Evasion was mentioned. So it is not new, and it is not shocking.

What I find strange is that anybody is trying to do something about it. I wholeheartedly believe that the political systems in most western countries are irreparably broken and absolutely corrupt. The only logical conclusion is that position of those in power have shifted their ideology and wish to trade the value of secrecy for the value of intelligence (data).

Privacy takes power away from governments. Tax Evasion does not always require privacy. It certainly helps, but it is not required. So I view this as mostly an attack on Privacy with the "cover" of going after Tax Evasion.

Taxes are a controversial subject, but I really see it as a choice between 2 systems.

An active system which grants authority to take away privacy through auditing and information policies and the legal foundation to seize property. This is what we have now. A system that grants a large amount of control to certain people that through a perverted legal authority can destroy lives with a guilty-first, innocence-proven-later approach. Additionally, the value of the data, and the ability to gain said data, is way to attractive to other governmental agencies that wish to use it as leverage or in some other "intelligence" related manner. What I have always found so despicable about this approach is that once you "kill" somebody and realize it was a mistake later, you cannot raise them from the dead. Also, a dead person cannot defend himself. Many Americans have been destroyed by the IRS only to prove themselves correct later. This was of course after all their property was confiscated and sold. I am not saying there are true tax evaders, but for every 10 of those I would speculate at least 1 person is truly innocent.

The other system would be a passive system. One in which Privacy can co-exist harmoniously. Instead of taxing personal income, just tax purchases. A consumption tax, which is not unheard of in the US, and did in fact exist in its past. There are alternatives to a consumption tax and the basic idea is to not tax income, but to tax expenses. The government would have no business in the private financial affairs of its citizens anymore. Banking data would become intensly private, as it should be. Why care if somebody has 100 million dollars in the bank? The moment they try to live their lives in a higher standard of living than the average person, they must start paying higher than average taxes. The taxes on those private jets and the gasoline alone would represent the yearly taxes for whole neighborhoods and communities of people. What happens when they die? They leave 100% of it to their children with none of going to the state in the form of death taxes. Same situation all over again. The kids would have to pay taxes on any "big ticket" items they purchase as well. Flat taxes, consumption taxes, etc. WORK. They just don't work for the real interests of the government.

In any case, the tax environment in the US and many countries was setup from the very beginning to favor the tax evader. It was meant to tax the poor and the middle class while providing methods for the rich and the elite to hide their wealth.

If you think I am too cynical... pick up any copy of "Millionaire" or "Billionaire" magazine or any similar publication and look at the full page advertisements for "Asset Protection", "Tax Deferment", or "Zero Tax Liability".
 

Re:I don't give a $*&%$ about the Swiss.... (3, Insightful)

AuMatar (183847) | about 6 years ago | (#22910384)

Flat taxes and consumption taxes most certainly *DO NOT* work. THey're highly regressive, effecting the poor far more than the rich.

Take a rich man who makes 1 million a year, and a middle class man who makes 40K. Lets say the tax rate is 20%. With a consumption tax, the guy with 40K will likely need to spend 33K on food, clothing, shelter, entertainment, etc. He'll pay 20% taxes on that, adding up to 6,600 dollars. He basicly breaks even. The rich man may spend lavishly, and spend 300K. He'll pay 60K in taxes. The rest he saves. He only paid 60K taxes, a mere 10x the poor man despite earning 25x. This shifts the tax burden onto the poor. This is not acceptable.

Now take a flat tax. There's two types of flat tax- flat by rate, and flat by dollar amount. If you have flat by dollar amount, you have the same problem as above, but magnified- it will likely be 50% or more of the poor man's salary. If you do a flat rate, you haven't solved any of the problems of the current system- you still need to figure out how much he actually made, and he still has incentive to hide it.

Flat taxes just don't work. Consumption taxes, while they are technically possible, don't work socially- far too regressive. The only people who really think either of these are a good idea are those who are already rich and have the "Fuck you, I got mine" attitude, and those who don't understand math.

Re:I don't give a $*&%$ about the Swiss.... (-1, Flamebait)

Anonymous Coward | about 6 years ago | (#22910446)

> The only people who really think either of these are a good idea are those
> who are already rich and have the "Fuck you, I got mine" attitude, and those
> who don't understand math.

Or those who believe that a system where you are punished for working harder than the majority of the social welfare parasites (that rely on the 'state' to look after them) is utterly wrong and ultimately unfair. Nowadays the overwhelming majority of citizens in the western society have the same means and chances (free education, free university etc. etc.) of becoming successful and well paid - if they would only bother to pull their finger out their backside and start working for it, instead of pointing to the successful ones and scream for social equilibrium!

Re:I don't give a $*&%$ about the Swiss.... (0)

Anonymous Coward | about 6 years ago | (#22910784)

Posting as AC through an anonymizer in China for obvious reasons... I've been ass-raped by the IRS and don't want it to happen again... Good luck getting IP records from the PRC...

As one who has gone up against the IRS - and won - I whole-heartedly concur with your post. In my case, the IRS consistently, for 10 years, assigned my company a new EIN number WITHOUT informing me about it; apparently they mistyped my company's name when entering us in the first time, so each 1065 we filed had an EIN/name mismatch and resulted in a new EIN being generated.

10 years down the road, in comes Mr. IRS Revenue Officer, and I'm not only slapped immediately with a request for all documentations for all 11 companies (my real company and the 10 mistakes the IRS made), but with liens on all property - personal and corporate - and levies on all bank accounts - personal and corporate - for sums beyond which I ever had hope of attaining. Note BOTH actions are provably illegal, especially against personal accounts. Apparently they had sent notices to an address that was 9 years out of date, and since we didn't respond within 30 days, the levies and liens were enacted. Of course, the fact he drove up to our current address makes me wonder why the records weren't updated!

It was only because a good friend is also a federal tax attorney and took my case on a contigency basis that I was able to fight for the 2 years to get the liens lifted and "win" my case by the IRS deciding to "stop prosecution". They didn't want to go to trial because they'd lose. It took 2 years, and literally 10s of thousands of my own dollars to stop them from THEIR mistake. I was vindicated of everything, but after all the legal bills (at 80% off from my friend's usual rate) and the levies THEY KEPT, I ended up losing over $75,000.

Not to mention that during the two years I willfully violated the law by continuing operations and selling product that had IRS liens on it. Yes, I was forced to break the law - either that or shut everything down.

Oh, about levies? The banks turned over all requested funds without a warrant, just a levy notice. And that is illegal, but the laws indemnify the banks if they believe the notice is proper from the IRS. Suing the IRS? Good luck, because unless you can prove willful or criminal negligence they're indemnified. So it's a "free" $75K to the IRS. All the while I was paying my usual federal corporate and personal taxes, funding them to prosecute me. Not only can they take your assets so you can't defend yourself, you have to pay THEM to keep going after you.

I can only imagine how bad it would have been if I didn't have my friend to help out. Hell, we had to resort to an FOIA and threat of a lawsuit to get my OWN corporate tax files! So much for "discovery" with the IRS. If he hadn't helped me, I'd have lost everything - all corporate assets, all my personal property, and not only have to declare bankruptcy but still be paying on a bad debt (bankruptcy does not absolve you of tax debts).

No other entity has the ability to not only charge you with a "crime", but does so under the presumption you are guilty until proven innocent AND has the ability to remove your financial/resource foundation to defend yourself. They can take and lock down EVERY asset and dollar you have; unless you have a friend willing to do it pro-bono, you're screwed.

Now? I started a nominee overseas corporation. There is exactly ONE piece of paper that identifies me as the actual owner of the company, and it's stashed in an overseas safe deposit box registered under a friend in said overseas country. I am a second signatory on his box (but not listed in the full ownership of the box), the payments for the box are tied to automatic payments from my new company's account. And I have the two keys to the box.

That company? The company exists in the name of a nominee, who does not know who I am. A lawyer overseas vouched that I was a legitimate and legal individual when directing that nominee to set up the company. The nominee formed the company and legally resigned, turning over all assets to the bearer of that note in that safety deposit box. It is a bearer company, meaning whoever holds that paper is the owner - no name needed.

Personal assets? I have none. I legally sold my house, cars, and larger personal assets to the company for cash at fair market value, making me eligible to receive a nice set of payments tax-free (house appreciation was less than $500,000 and proceeds from sales of personal assets are tax-free). My overseas company now owns my assets, and I am an employee of the company, just getting a monthly stipend of a very small amount. I have a company provided cell phone and health plan, but the house, cars, etc. are general corporate assets usable by any company employee (per the company handbook) meaning they are not dedicated to one person, so they are not considered "equivalent income". The house is the office, and I work late hours so I often sleep over at my office. My legal residence is now at my sister's house, 3 miles away.

And that overseas jurisdiction? Income made on activities outside of its borders is tax-exempt. So my clients pay a company overseas, and that company gets the dollars tax free of any income taxes. You can trace dollars to a company that does not have an actual owner listed, with an empty address.

The bank? Strong privacy laws, and the same nominee set that account up. It's accessed by wire transfers in, online wire transfers out to my account for my payment (online access is via secure anonymizers), and ATM activity overseas. Not a single shred of discoverable paperwork ties me to the ownership of the company, meaning that there is no way to prove I am not reporting overseas income (which legally I'm supposed to do).

Essentially, fuck them. They deserve it. I refuse to open myself up to that criminal group ever again. I lost two years of my life and over $75,000 proving I did nothing wrong, only to have them drop the case - not declare me correct, or innocent, just not worth pursuing. In their eyes - and legally - I am still considered a tax cheat, just not collectable or not worth pursuing.

People rail against the evil "3 letter departments" like the CIA, DOD or the FBI; the real criminals who pull the most strings over people is the IRS. The fact they can - and regularly do - confiscate everything and force you to prove it was wrong of them to perform such takings is beyond the issues of the CIA/FBI listening in on me talking to a buddy overseas.

Oh, and the kicker? Last year I shuttered that original company, when I started the overseas company (for $2500, by the way, and $800 per year annual maintenance). I got a letter this February telling me that the EIN was wrong, and that I should use a new EIN. At least the fuckers got the address updated, but the name is apparently still wrong. Well, good luck this time - there's nothing left, and I have zero assets. Go ahead and get a lien on my income of $1200/month - just see what you can get, IRS jack-booted thugs. Now I pay zero taxes and am free of the strings of the IRS.

List of Liechtenstein tax evaders offered to UK (2, Interesting)

auric_dude (610172) | about 6 years ago | (#22910258)

Britain turned down the chance to recoup £100m (133m) in unpaid taxes from UK residents with bank accounts in Liechtenstein at least two years ago because revenue officials refused to pay a whistleblower a tiny fraction of that sum. The informant turned instead to Germany's secret service, selling a list of at least 750 wealthy Germans with money stashed away in Liechtenstein. This has sparked Berlin's biggest crackdown on tax evaders and triggered a diplomatic row with the principality. . . Read more via the FT. http://search.ft.com/ftArticle?queryText=lichtenstine+secret+service+tax&y=0&aje=true&x=0&id=080225000064&ct=0&nclick_check=1 [ft.com]

FYI (0)

Anonymous Coward | about 6 years ago | (#22910358)

If you work very hard in Germany and earn say $150k a year, you pay 50% tax. If you choose to consume the rest of the money around 20% VAT is due on all goods. That means you pay around 70% taxes on your income (not putting into account 70+% taxes on fuel and some other niceties). Lets say you choose to save some of the remaining money (which has been taxed at least twice by now) in a bankaccount - the resulting interest has to be taxed AGAIN!
So why do you think people would like to export their funds to some safer places, where the real criminals have no or limited access to it??

It is the tax system of massively oversocialzied countries like Germany that's wrong NOT sovereign states like Switzerland or Liechtenstein.

Re:FYI (2, Informative)

Knuckles (8964) | about 6 years ago | (#22910428)

If you work very hard in Germany and earn say $150k a year, you pay 50% tax.

This is simply a lie. You pay 35%, which you can easily check at several online tax calculators, such as http://www.zinsen-berechnen.de/einkommensteuerrechner.php [zinsen-berechnen.de]. And that's only if you are stupid enough to tax everything.

Re:FYI (0)

Anonymous Coward | about 6 years ago | (#22910500)

It's not a lie. I lived, worked and paid the 'Höchststeuersatz' of 43% (+ mandatory social insurance, church tax, Eastern German tax, etc.) for much tool long there!!

So you are proposing of evading tax by 'not being stupid enough to tax your whole income?'

While gradually abolishing privacy alltoghether, the German government does not even shy away from buying stolen information information to spy out its citizens. They are outright criminals, who even have the unbelievable arrogance of telling sovereign states to change their laws and tax systems to comply to the German 'official daylight robbery' system.
These politicians are smart however, because they even enforce the omnipresent envy and informer culture in the country to use it to their advantage - all in the name of social fairness of course...

Well, I guess the 'old' saying is true: Every society gets the politicians and the TV program it deserves...

Re:FYI (1)

Knuckles (8964) | about 6 years ago | (#22910854)

It's not a lie. I lived, worked and paid the 'Höchststeuersatz' of 43% (+ mandatory social insurance, church tax, Eastern German tax, etc.) for much tool long there!!

If you lived there, you should have learned how the tax system works:

For the first 7,664 EUR you earn per year, you pay no income tax at all. (This remains the case even if you do earn more than 7664.)

For the income above EUR 7,664 up to 52,152, you pay a progressive rate, starting with 15% for the first bracket. I'm too lazy to look up the actual brackets and their tax rates, suffice to say that the tax rises by 0.61% per additional one thousand EUR you earn. For the part of the income that falls into the highest bracket up to 52,152, the tax rate is 42% (Spitzensteuersatz). This then stays the same up to EUR 250,000. Income above 250,000 per year is then taxed with 45%.

To repeat, it's not as if you pay 42% of EUR 250,000. Instead, you pay an increasing rate for each part of your income, depending on which bracket in falls into. You pay 0% for the first 7,664, plus 15% for the next bracket above that, etc. You pay 42% only for the part of your income that is higher than 52,152.

Hence, if you earn EUR 95,000 (USD 150,000), you pay an average of 35%.

http://de.wikipedia.org/wiki/Einkommensteuertarif [wikipedia.org]

So you are proposing of evading tax by 'not being stupid enough to tax your whole income?'

No, there are legitimate ways to deduct tax. E.g., if you are married and the partner makes way less than you, you can enter a special tax mode where both your income is taxed together, with higher rates for the lower income and lower rates for the higher income. This can easily save 10%.

You can deduct certain insurances, most health expenses, professional expenses (any expenses you conceivable could have needed for you profession; think books, etc.). I'm no tax expert, there are many more ways to deduct. (This is part of the problem, actually, because people with higher income (even the not self-employed) have much more ways to deduct taxes as people who scramble to get by. It might be fairer to reduce taxes overall, while removing or lowering some of the deduction options.)

Have you ever even seen a German tax form?

BTW: paying church "tax" (which is not really a tax but just the state collecting membership fees for the christian church, because it has the infrastructure already in place, anyway) is entirely your own choice.

Re:FYI (1)

Slorv (841945) | about 6 years ago | (#22910498)

You (along with many many others) are missing out on what a tax is.
Firstly what your talking about; a transaction tax is drawn on certain transactions like when beeing paid sallary, buying and selling of gods etc. So you pay a certain amount of tax for each transaction. It's common misconception that "once I've paid tax on this pile of money taxpaying should be done with". That's not how it works.

Then there are of course other types of taxes aswell.
Taxes are good for all of us, rich or poor but only as long as every paying instance, person or company, pay. If everyone paid there tax then the taxes actually could be reduced. But I doubt they would ;)
However I do believe that in many countries in northen europe transaction taxes are way too high. Sales taxes at 20-25% are imho ridicoulus.

Re:FYI (1)

BiggerIsBetter (682164) | about 6 years ago | (#22910612)

As a New Zealander, I have to say that over-taxation of the kind described is absolutely a bad idea. Here we have millions available to buy high-country land for conservation, to pay for medical care for refugess with AIDS, for politicians amusements, and especially for helping the underpriviledged. Meanwhile, we're in a housing crisis because nobody with a regular job can afford even the deposit on a home because they've got nothing left after PAYE, Student Loans, KiwiSaver, ACC, Earner Premiums, etc, etc. Once you've lost around 47% percent of your income in tax, groceries are then taxed at 12.5%, and fuel is taxed over 60%, and so on. You do what you can to minimise it, but as an Employee, there are limited options.

I agree that some taxation is necessary, but socialism is killing the middle class. I'm seriously considering a move to somewhere like Hong Kong [about.com] with their more reasonable 20% rate.

Re:FYI (1)

jcr (53032) | about 6 years ago | (#22910718)

I agree that some taxation is necessary, but socialism is killing the middle class.

Socialism certainly hurts the middle class, but the damage it inflicts on the poor is far, far worse. A dependent is a slave.

-jcr

The problem is NOT anonymity or even tax evasion (1)

Colin Smith (2679) | about 6 years ago | (#22910374)

The problem is money creation itself, of the very nature of banking.

 

Re:The problem is NOT anonymity or even tax evasio (1)

justinlee37 (993373) | about 6 years ago | (#22910788)

Right. All of the evils in the world will be alleviated if we simply do away with currency and operate as a barter economy.

Don't you get it? People aren't greedy for money, they're greedy for the material possessions they can acquire with money, and getting rid of money won't get rid of that greed. You'll have the same problems you had before, along with some new ones, because you acted like an idiot and dismantled the system that allows us to specialize. You know, so some of us can have jobs besides just rustlin' steers and tillin' fields?

I'm rich (2, Funny)

Hojima (1228978) | about 6 years ago | (#22910464)

I'm completely in favor of hiding the identity of those who have money in Swiss accounts. I am now in the rich demographic since I just got an email informing me of an inheritance for 400K from a long lost Swiss cousin of mine. All I had to do was give them my social security number (they didn't tell me his name. Most likely to keep him anonymous).

Re:I'm rich (1)

Slorv (841945) | about 6 years ago | (#22910510)

I got that aswell, I simply had to pay 1000 for various fees and services. Then this very nice african banker would pay me the heritage from my unknown relative. Come to think of it, I haven't heard from that banker in a while now.

Black economy (1)

Alain Williams (2972) | about 6 years ago | (#22910554)

While they are out extracting taxes from the rich: it is about time that they tax those in the black (cash) economy who don't pay tax at all.

Flat Sales Tax (1)

raal (14531) | about 6 years ago | (#22910862)

To bad we don't have a Flat Sales Tax instead of the Income tax here in the US. They this wouldn't really matter as we would not be taxed unless we actually bought something! It would make things a heck of a lot simpler. Maybe I could actually be in control of my own life and decide what I spent my money on.
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