Swiss Bank Secrecy Under Renewed Attack 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."
Reality mirroring Science Fiction (Score:4, Interesting)
Oh but you can. (Score:2, Interesting)
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 (Score:3, Interesting)
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.
I don't give a $*&%$ about the Swiss.... (Score:3, Interesting)
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".
List of Liechtenstein tax evaders offered to UK (Score:2, Interesting)
Re:Secrecy is fine when it protects individual rig (Score:2, Interesting)
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 (Score:5, Interesting)
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:tax burden myths (Score:3, Interesting)
One reason the rich get a lot of these tax breaks, is that they assume higher risks, and do more entrepreneurial things. Yes, if you got $100M in the bank, it's pretty easy to assume risk on new investments. Nonetheless, the risk is what is being rewarded. If you bought a condo in Mexico (not out of the question for many people who earn a reasonable salary), you too could justify a "business expense" to go visit it. If you are self-employed, and use your car ostensibly for work, you too can write it off. The tax breaks are there. If you take a 100% safe job earning a specific salary, it's true, there aren't many tax breaks; but you're not assuming much risk either (unless you rack up credit card bills and such; but that's more bad financial planning, than actual risk.)
I do agree there are some loopholes that need to be plugged; but overall, there are some good reasons for the way it is. If you have problems with specific tax-writeoffs, lobby your government representatives to change things.
Re:Singapore? (Score:1, Interesting)
I saw the customer section that deals with German customers move there quite recently (this is in one of the largest Swiss banks).
It's quite fascinating how naive the attackers of Swiss financial secrecy/privacy are... the money in Switzerland is really part of the global economy and the money can be reallocated in an instant. There are literally hundreds of secrecy jurisdictions on this planet - the swiss just provides a premium service.
If the Swiss banks could not provide banking secrecy - then they would just hop to another jurisdiction...
I do investments into africa, something that provides jobs and a future for a number of people who in the past were close to starvation.
In many countries, the current tinpot dictator would try to acquire my assets by creating a new law, then going after my assets.
Switzerland protects me from this by providing banking secrecy. This reduces the political risk of investments I make on the continent, thereby enabling me to expand faster. If I did not have the added protection that a Swiss bank provides, there would be 40-50 more people who'd be poor, living from day to day with bleak prospects (on a continent where bleak==starvation).
Secrecy Laws (Score:2, Interesting)
Re:Reality mirroring Science Fiction (Score:5, Interesting)
The K31 is a couple generations old, but I don't imagine they've gotten worse since then.
Re:How about these people, including my fellow dem (Score:3, Interesting)
Socialism is about providing free (to the recipient, paid by tax money) education, healthcare, and economic safety nets for everyone. It has been a huge success everywhere it has been tried; as a specific example, it transformed Finland from an economically abused, agricultural society which had just gone trough a civil war into one of the most prosperous countries in the world in half a century.
Communism is about the state owning everything and centrally planning the whole economy, and has been a failure everywhere. However, it is impossible to conclude at this time whether these failures habe been caused by any inherent defect in the ideology itself or the personality flaws - such as psychopathy - of the people who implemented most communist economies, as well as continued interference from the United State in its effort to oppose communism.
Neither Libertarianism nor Laissez-Faire Capitalism are interested in efficiency. Libertarianism is an ideology that freedom takes priority over everything else, and usually also includes a strong anti-government theme. Laissez-Faire Capitalism is a believe that market forces will find the best solution to any problem, if there is no government intervention or regulation.
It should be noted that there are ideologies which combine personal freedom with socialistic economy; see Left-libertarianism [wikipedia.org] and Libertarian Socialism [wikipedia.org]. These ideologies generally consider private ownership of means of production and the resulting power structures no different than those of the state, and thus an anathema to freedom; there is no difference between coercing someone with threat of a bullet to the head and threat of starvation. I'm inclined to agree, altought I don't see how you could possibly keep the accumulation of wealth - and thus power - to a few individuals under control except through force, which in turn results in whoever wields that force to become the dictator instead.
It is a mistake to think that all libertarians only oppose oppression by the state; apparently some also oppose oppression by the plutocrats. It's simply that the anarcho-capitalists happen to be more vocal on Slashdot.
Re:Reality mirroring Science Fiction (Score:3, Interesting)
"Nothing's changed then to make a rifle-armed mob any more effective"
Terrain helps a lot. Your tanks and trucks will not have a good time of it.
If you have decent snipers scattered about Alps with their supplies, none of the enemy grunts would want to be promoted after the officers keep getting their heads blown away.
And I bet even if your tanks get past the first chokepoint, by then the Swiss gov would have issued people rocket launchers.
You can nuke or carpet bomb them, but given the Swiss say "we're neutral, don't mess with us and we might actually help you stash your loot", most countries with a clue will skip them.