Because of the LuxLeaks scandal, the world knows that Luxembourg granted secret tax rulings to about 340 multinational clients of global accounting firm PwC. The leaks caused Europe to revamp its entire tax ruling regime, increasing transparency accordingly.
Tax Analysts Blog
Former Tax Court Judge Diane L. Kroupa and her husband were recently indicted in Minnesota on multiple tax charges, including conspiracy to defraud the United States, tax evasion, subscribing to false tax returns, and attempting to obstruct an IRS audit. According to the indictment, between 2004 and 2010 Kroupa and her husband deliberately concealed $1 million in taxable income, on which they failed to pay nearly $400,000 in income taxes.
Even though governments have been exchanging financial and tax information for decades, the volume, frequency, and regularity of those disclosures has begun to grow exponentially, and will soon grow logarithmically. If past intergovernmental information exchanges reflected the pace of a horse, and current exchanges have begun to approach the speed of a Ferrari, the exchanges on the near-term horizon will resemble the warp-speed travel known to fans of Star Trek.
Every so often these days, it looks like the member states of the European Union might unite on tax administration and policy issues. Building upon a fairly successful coordinated VAT regime, the EU is considering coordinating other tax policies. These include a financial transactions tax and the European fiscal Holy Grail, the common consolidated corporate tax base.
The European Commission is investigating whether the sweetheart tax deal that Apple negotiated with Ireland 25 years ago distorts competition within the common market, under article 107 of the Treaty on the Functioning of the European Union.
I recently attended the Capital Matters conference, presented by the Tax Council Policy Institute in Washington. The 2016 conference focused on how taxes influence the global creation, deployment, and mobility of capital. This was my second year attending the conference, which showcases the best thinking of influential tax professionals and business leaders. And both years offered a glimpse into how the corporate world views the tax world. What a view!
During the lunch break at a tax conference in Lisbon last January, I was fortunate to be seated next to a brilliant tax professor from the U.K., Rita de la Feria. Shortly after we exchanged the usual pleasantries, she asked me a pointed question. Although it required little thought to answer, the question itself raised issues that have colored how I view recent events – including developments in international taxation – in Europe.
This is the time of year when many people make resolutions promising to do things differently come January, reasoning that it is good to start fresh when the last digit in the year changes. Except for resolving to write the new year correctly on all my checks starting January 1, I am not one of those people. If something needs fixing or doing differently, I try to take care of it right away. After all, if a problem crops up on January 30, why would I wait 11 months to do something about it?