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Swiss bank won’t cooperate? Bar U.S. access
Monday, March 9, 2009 | 2:04 a.m.
It’s tax time and once again the rich are complaining that the poor are not paying their fair share. It has been reported that during the past eight years, the top 1 percent of income earners have doubled their income, going from having 10 percent to 20 percent of all personal income in America.
It should not come as a shock to ordinary Americans that the rich don’t always get that way simply by luck, hard work and brilliant insight. Sometimes they get extra help. This is the case with many American investors at UBS. This international investment bank, headquartered in Switzerland, has refused to provide the Internal Revenue Service with information on 52,000 suspect accounts. These are accounts of U.S.-based investors who may have not reported income and are avoiding paying income taxes. UBS claims that under Swiss law it is forbidden to disclose any information about these accounts.
Perhaps this is its right. But it is also the right of our government to terminate UBS’ right to do business in the United States. We should give UBS 12 months to clean up its business here before saying goodbye. Now about those 128 subsidiaries Morgan Stanley has in the Cayman Islands and other offshore tax havens where financial disclosure is not required ...
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If they refuse to cooperate then lets declare war on Switzerland
mycroft6, you are an idiot.
Once again the US meddles in another country's business. If Swiss citizens invested money in a US bank do you think the Swiss government would demand to get the names of those people??? No, of course not! They would immediatly want to know WHY the Swiss people wanted to invest their money in the US. They would offer incentives to get that money back. But what does the US do?? We threaten the Swiss and sue them. It makes sense, because most of our government leaders are lawyers, it's what we do best, sue.. we should be competitive. our banks are toast. Rich people prefer other banks.
Good cocoa though.
bowater, I'm trying to grasp how your post makes sense. So the U.S. should open banks that hide the accounts of U.S. citizens so they can pay no taxes on that money? This is the Reagan free-market-run-amok model taken to its (il)logical conclusion. Unfortunately, we have many citizens here who have been sold on this anti-middle-class theory. "Rich people prefer other banks" that hide their money so they aren't paying taxes on them - so you think our own banks should provide that service. Beyond belief. It's time for Americans to start taking to the streets. All of these types of banks should be put out of business in the U.S., and those using them need to face serious penalties.
Watch the residency flight of the uber rich. It's too easy to establish your business interest completely off shore. American business has been headed out for decades. Unless we drop our business taxes to compete with other countries we will not grow the economy or jobs. We will just keep seeing more service located off shore.
And where would they go neiman????
Oh yeah every OTHER nation has socialized medicine, oops.
Then there's the various other places where there is a significantly higher degree of "socialism". So no there isn't going to be a cataclysmic shift of the rich leaving.
red,
Off topic, but in regards to your post about socialized medicine. The reason Canada's system works is because the rich Canadians drive south to get healthcare from US.
On topic, congress will never overtly meddle with the rich. That would affect them as well. Token gestures of raising taxes and closing meaningless loopholes are as agressive as it will get.
Remember it takes rich friends to get elected.
UBS got busted and paid a substantial fine. They got rid of all their offshore US customers and are in full compliance at this point with bilateral US-Swiss agreements. UBS employs 20,000 people in this country so if they leave it will be a much bigger deal than Lehmann Brothers going bust.
If you want to look at tax havens, there is no need to go very far. The state of Delaware is a tax haven and a hub for money laundering that is even blacklisted by countries like Brazil a fact that is rarely mentioned in the domestic press but widely covered elsewhere.
Sorry bowater - you're way off base - There's a definite reason why rich americans don't want to deal with an american bank and it has nothing to do with lower interest rates and bad customer service - it has EVERYTHING to do with the fact that in dealing with a bank here in america they wouldn't be able to 'hide' their assets and would therefore have to PAY TAXES on the money - And how is it to be considered 'meddling' if the US terminates the Swiss Banks' right to do business here? No one is asking/demanding that they change any of their business practices - they're just being told that business practices such as theirs are not acceptable in this country. The banks in switzerland can continue to run their business however they sit fit - just not in this country. And if the Swiss were to suddenly start banking here I'm sure their country would be interested as well - not for loss of business but for the same reason - loss of TAX MONEY. There wouldn't be an incentive big enough, other than to tell their people that they can invest their money in their own country and NOT pay taxes on it - ya, that would encourage the Swiss to bank in their own country - other than a promise of being totally tax-exempt there wouldn't be a good enough reason. You don't honestly believe the rich are hiding their assets in other countries because they were given a free toaster when they opened their account now do you?
and also remember - Only the rich get elected - so they would then have to open up their own wallets and fork it over - that's the problem in this country - there isn't a middle-class politician amongst the whole crooked bunch.
You need to distinguish 2 things.
1) UBS actively recruited US citizens to go hide their money offshore. This is very wrong. They got busted. They paid a $750M fine and got rid of all their offshore US customers. What else do you want them to do?
2) Some US citizens go to Switzerland and open Swiss accounts. It is 100% legal. If those people do not report their taxable interest, it is a problem between those individuals and the IRS. UBS or any other Swiss bank is not an agent for the IRS. UBS has no choice but to stick to Swiss laws. Switzerland is not a colony of the US. Established procedures between the 2 countries exist for the exchange of bank account information.
If the US does not like Swiss laws then it needs to be negotiated politically. Not by suing and bullying.
It would be useful to mention that Swiss firms employ 300K+ people in the US. Switzerland is one of the top 7th biggest foreign investor in this country.
Let's not forget Delaware, a tax haven state that allows the creation of opaque shell companies (600,000 are listed) to help the wealthy avoid taxes. Let he who is without sin cast etc...