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Gayle in MD
09-30-2012, 08:57 AM
The Real Problem With Romney's Offshore Investments
Forget the 47 percent. Foreign tax havens—and investment vehicles like those the GOP candidate established at Bain Capital—are robbing world treasuries of billions.
—By Stephanie Mencimer

| Tue Sep. 25, 2012 3:00 AM PDT
398


Mitt Romney's taxes are once again in the news thanks to Friday's release of his full 2011 tax return. As with his 2010 filings, the documents highlight the GOP candidate's extensive overseas holdings, which some tax experts believe has allowed him to lessen his tax liability. But the problem with Romney's reliance on offshore tax havens goes beyond his own tax bill.




The Internal Revenue Service and many members of Congress have sought for years to close some of the loopholes that are draining billions of dollars from the federal treasury and shifting the tax burden from wealthy corporations to average individuals. Yet through his work at Bain Capital and his personal investments, Romney has supported a shadowy financial system with far-reaching ramifications for the US and foreign governments.

To date, Romney has refused to answer questions about why, for instance, he needs to keep some of his money in places like Bermuda, rather than a bank in Belmont, Massachusetts, or in a US-based investment vehicle. When he dodges these types of questions, Romney's not just depriving voters of critical information about his own taxes. He's sidestepping a much larger policy question about this unaccountable financial system that has been a key driver of global inequality.



Offshore tax havens are better known for facilitating money laundering and tax evasion than legitimate business. They are jurisdictions that generally offer extremely low tax rates to foreign investors (zero in the case of the Cayman Islands). They also offer sanctuary to people or entities looking to avoid other rules and regulations or seeking to shield their assets from lawsuits in their home countries. And, of course, tax havens provide secrecy. They hide owners, partners, and investors from tax authorities or jilted spouses and often refuse to comply with criminal investigations by other countries, which is one reason they're popular with both drug kingpins and Americans tax evaders.

Romney has investments in a number of well known tax havens, including Ireland, Luxembourg, the Cayman Islands, and Bermuda. Until 2010, he held a few million in the Swiss bank UBS, which in 2009 was forced to pay the US $780 million in fines and penalties for helping more than 17,000 Americans commit tax fraud by hiding as much as $20 billion overseas. The total value of Romney's offshore investments is unknown, but his tax returns have revealed that he has at least $30 million invested in the Cayman Islands, in at least 12 different Bain Capital funds. When pressed about the relationship between his offshore investments and his low tax rate (he paid 14.1 percent on $13 million in income, according to his 2011 tax return), Romney has largely declined to answer questions about his overseas holdings other than to say, "I pay all the taxes that are legally required, not a dollar more." Romney has also denied getting tax benefits from his offshore accounts. He told Fox News, "[T]here was no reduction, not one dollar reduction in taxes by virtue of having an account in Switzerland or a Cayman Islands investment. The dollars of taxes remained exactly the same. There was no tax savings at all."

Similarly, a Romney campaign spokeswoman told Mother Jones that Romney's foreign investments "are taxed in the very same way they would be if the shares were held in the US rather than through a Cayman fund. No taxes are avoided or reduced. These funds are registered with the IRS and report all income to investors and the IRS, just like domestic funds."

Romney's assertion that his offshore investments have not reduced his tax bill has been met with skepticism by tax experts. But assuming he's telling the truth, his involvement in the offshore system and that of the company he started, Bain Capital, is still no less significant. That's because while Romney may have done everything by the book with his offshore accounts, Bain's other offshore investors may not have.

"The Cayman Islands jurisdiction for the Bain funds primarily makes it easy for their investors to cheat on their taxes."
Bain's has had investment funds located in the Cayman Islands since at least the 1990s, when Romney was still in charge. And the company has made clear that many of its funds there are designed to avoid US taxes. According to documents released by Gawker in August, one fund in which Romney still has money invested notes in a financial statement that it "intends to conduct its operations so it will…not be subject to United States federal income or withholding tax."*

"The Cayman Islands jurisdiction for the Bain funds primarily makes it easy for their investors to cheat on their taxes," says Rebecca Wilkins, the senior counsel for federal tax policy at the nonprofit Citizens for Tax Justice. "Because of that they can attract more investors and they can earn bigger management fees. "

Because of the secrecy laws in the Caymans and other offshore tax havens, Bain investors are hidden from tax authorities like the IRS. Unless they choose to report their holdings and income, as Romney has, there is no way for tax officials in the US or other countries to know that such holdings exist, much less find a way to tax them.

James Henry, a former chief economist at McKinsey & Co., describes offshore tax havens like the "bar scene in Star Wars." He explains, "Dictators and kleptocrats used them to conceal stolen loot. Arms dealers and drug dealers use them to launder their deals. Google and Apple and Pfizer use them to park their intellectual property and pay themselves tax-free royalties. Banks use them to park lousy loans and stash the offshore accounts and assets under management of their wealthy individual clients, many of which are paying zero taxes back home…And so on."

Some of those sorts of shady clients have been part of Romney's portfolio at Bain. Nicholas Shaxson has written one of the most comprehensive stories about Romney's offshore investments in a lengthy article in the August issue of Vanity Fair. It explored the nature of some of Romney's early Bain investors. They included the late Czech-born British media tycoon Robert Maxwell, a fraudster and notorious tax evader who put $2 million into one of Romney's first Bain funds, as well as a trio of anonymous corporations from another notorious tax haven, Panama. Other early investors, according to numerous news accounts, were members of the wealthy Salvadoran oligarchy with ties to right-wing death squads. Romney has credited Salvadoran investors for helping him get his company off the ground.

Next Page: Romney has decried the 47 percent but has championed the use of tax havens by American big businesses.
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http://www.motherjones.com/politics/2012/09/mitt-romney-offshore-investments-cayman-islands

eg8r
09-30-2012, 12:07 PM
LOL, many companies and individuals have stated they would bring their money back to the US if the tax code was changed. It cracks me up to see lefties tell people they are intelligent and then wonder why rich people take advantage of all options to keep their money.

Idiot lefties raise taxes, fees, etc in CA and what happens, most of the money leaves the state/country. Lefties sit around stunned that this would happen.

eg8r

Soflasnapper
09-30-2012, 01:40 PM
LOL, many companies and individuals have stated they would bring their money back to the US if the tax code was changed.

What they demand is tax FORGIVENESS, considerably different from your gloss on it. We already did one round of that, and all it led to was still more tax avoidance, now at record levels.

eg8r
09-30-2012, 06:47 PM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">
What they demand is tax FORGIVENESS, considerably different from your gloss on it.</div></div>That is a change in the tax code, temporarily. As far as already doing one round and it leading to even more that shows the lefties are even dumber than I gave them credit for. LOL, the first time they sat there stunned the rich would do what is needed to keep their money safe. Bringing it back under better conditions was enough to get them to bring the money back, however since the tax code was not changed for good they went right back to what they were doing in the first place.

Apple has already stated what they would do with the money if they could bring it back. That did not include moving even more overseas as you would suggest will happen.

However this is not worth arguing about. I will say it quite blatantly, the left who want to increase taxes are absolute idiots if they think it will result in any real gain in tax receipts. The rich will continue to do the things that make them rich and part of that is making sure their money is safe.

You know what is really funny about all of this is that you are pissed off at Romney for doing exactly what Buffet does. Warren has all the lefties heads spinning. Romney bad, Buffet good. Both avoid as many taxes as possible but Romney is (R) and Buffet is a (D). (R) bad, (D) good. Retards.

eg8r

LWW
10-01-2012, 02:12 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Soflasnapper</div><div class="ubbcode-body">LOL, many companies and individuals have stated they would bring their money back to the US if the tax code was changed.

What they demand is tax FORGIVENESS, considerably different from your gloss on it. We already did one round of that, and all it led to was still more tax avoidance, now at record levels. </div></div>

Wrong, as usual.

What they demand is not to be taxed twice.

Qtec
10-01-2012, 04:35 AM
Once again you show a total ignorance of the facts.

<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> New evidence on Bush's tax amnesty
From the NY Times:

"It was called the “Homeland Investment Act,” and was sold to Congress as a way to spur investment in America, building plants, increasing research and development and creating jobs. <u>It gave international companies a large one-time tax break on overseas profits, but only if the money was used for specified investments in the United States."</u>

This was a measure enacted by the administration of former U.S. President George W. Bush in 2004 that gave a tax amnesty to multinationals who had been keeping money, tax-free, offshore: it allowed them to bring back that money, <span style='font-size: 14pt'>and pay a tax rate of 5.25%, instead of the normal 35% corporate tax rate.</span> The idea was that they should use that money to build things in the United States, and the law specifically said the money could not be used to raise dividends or to repurchase shares. About $300 billion whooshed back into the United States through the loophole. It was pushed by a spooky-sounding group called the Homeland Investment Coalition which forecast that the measure would help the US economy by "increasing domestic investment in plant, equipment, R.& D. and job creation."

Guess what happened.

<span style='font-size: 26pt'>"About <u>92 percent</u> of it went to shareholders, mostly in the form of increased share buybacks and the rest through increased dividends."</span> </div></div>

They didn't deliver. Now you are saying this time they will! Any evidence for that?

Eh.................NO!

Just like Mittens, with his 800 page tax return and his Cayman accounts, Swiss bank account and the myriad of holding companies etc, they say "trust us!"



Anyone who believes them is a sap.

Q

LWW
10-01-2012, 05:08 AM
The money <span style='font-size: 26pt'>BELONGED</span> to the shareholders.

Now do you suppose they:

1 - Invested it, which aided the economy.

2 - Loaned it, which aided the economy.

3 - Spent it, which aided the economy.

4 - Donated it, which aided the economy.

5 - Burned it.

Gayle in MD
10-01-2012, 07:21 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Qtec</div><div class="ubbcode-body">Once again you show a total ignorance of the facts.

<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> New evidence on Bush's tax amnesty
From the NY Times:

"It was called the “Homeland Investment Act,” and was sold to Congress as a way to spur investment in America, building plants, increasing research and development and creating jobs. <u>It gave international companies a large one-time tax break on overseas profits, but only if the money was used for specified investments in the United States."</u>

This was a measure enacted by the administration of former U.S. President George W. Bush in 2004 that gave a tax amnesty to multinationals who had been keeping money, tax-free, offshore: it allowed them to bring back that money, <span style='font-size: 14pt'>and pay a tax rate of 5.25%, instead of the normal 35% corporate tax rate.</span> The idea was that they should use that money to build things in the United States, and the law specifically said the money could not be used to raise dividends or to repurchase shares. About $300 billion whooshed back into the United States through the loophole. It was pushed by a spooky-sounding group called the Homeland Investment Coalition which forecast that the measure would help the US economy by "increasing domestic investment in plant, equipment, R.& D. and job creation."

Guess what happened.

<span style='font-size: 26pt'>"About <u>92 percent</u> of it went to shareholders, mostly in the form of increased share buybacks and the rest through increased dividends."</span> </div></div>

They didn't deliver. Now you are saying this time they will! Any evidence for that?

Eh.................NO!

Just like Mittens, with his 800 page tax return and his Cayman accounts, Swiss bank account and the myriad of holding companies etc, they say "trust us!"



Anyone who believes them is a sap.

Q </div></div>

What contributes to the vast inequality between the wealthy, and the rest, will continue to damage our economy.

As long as the void continues to expand we will lose economic stability, and equal opportunities, and no country, no time, no where, no how, thrives ecnomically, nor survives democratically, under those circumstances, Oligarchy/Fascism.

The Great Depression taught us that long ago, and Repiglicans continue to support policies which continue to create an even greater void.

We had the Bush Tax cuts, which favor the wealthy, for eight years. That was a complete failure in job creation.

Those who outsource American jobs, to enrichh their own wealth, like Romney, are the anti-American, unpatriotic, pigs among us. Those who are too ignorant to understand that, continue to vote against their own best interests, and that of our country.


The Communist Party of China thanks repubs for your ignorance!

Now explain the 60,000 factories w/o any loans that closed under BUSH with deregulation and low taxes?

Note Bain Capital under Romney and Wall Street in general have a higher rate of Bankruptcy/loan defaults than this high risk loan program, noting the 16 trillion dollar repair bill for Wall Street.

Note in his 2010 Book , No Apologies… Mitt condemned Obama for taking tariff actions against China, stating it would only make matters worse…Now he claims Obama has not taken action 7 times, when he has 7 times and won all 7 times… the most actions any president has taken.. more Mitt/Repub lies


Romney's hypocrisy knows no bounds.

G.

eg8r
10-01-2012, 01:18 PM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">They didn't deliver. Now you are saying this time they will! Any evidence for that? </div></div>There cannot be any evidence if it doesn't happen dillhole.

eg8r

Qtec
10-01-2012, 06:27 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: eg8r</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"><span style='font-size: 26pt'>They didn't deliver.</span> Now you are saying this time they will! Any evidence for that? </div></div><span style='font-size: 17pt'>There cannot be any evidence if it doesn't happen dillhole.</span>

eg8r </div></div>

What a moron you are sometimes.

Bush said giving these tax dodgers amnesty would increase jobs etc etc blah blah blah.

What happened? They took the tax break, bought their own shares and bumped up the price. They either sold those shares or took a loan against them [ I'm speculating here] bought Govt bonds and now the Govt [ you the tax payer] is paying them interest on the taxes the should owe!

If you don't pay a bill, that's evidence.

They didn't live up to the promises they made, that's evidence dillhole.

The ONLY evidence available is that they WON'T do what they say! Do you have any evidence that this time they will?


Of course you don't, DILLHOLE.

<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">About 92 percent of it went to shareholders, mostly in the form of <u>increased share buybacks and the rest through increased dividends</u> </div></div>

Q

eg8r
10-01-2012, 07:18 PM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">What a moron you are sometimes.</div></div>I am sorry, I gave you the benefit of the doubt that you actually read what you typed. My bad.

eg8r

Qtec
10-01-2012, 07:21 PM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: eg8r</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">What a moron you are sometimes.</div></div>I am sorry, I gave you the benefit of the doubt that you actually read what you typed. My bad.

eg8r </div></div>

Oh boy. You are actually starting to sound like LWW!!!!

Way to go.


Q

LWW
10-02-2012, 06:15 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Qtec</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: eg8r</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">What a moron you are sometimes.</div></div>I am sorry, I gave you the benefit of the doubt that you actually read what you typed. My bad.

eg8r </div></div>

Oh boy. You are actually starting to sound like LWW!!!!

Way to go.


Q </div></div>

Since you don't know what a capital gain is ... what do you think a dividend is?

Qtec
10-02-2012, 06:53 AM
If you don't know what capital gains is or dividends are, look it up. Google is a wonderful thing.

If that's too hard for you, go to http://www.ihavethebrainsofaboiledegg.com.

They can help you.

Q

LWW
10-02-2012, 08:07 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Qtec</div><div class="ubbcode-body">If you don't know what capital gains is or dividends are, look it up. Google is a wonderful thing.

If that's too hard for you, go to http://www.ihavethebrainsofaboiledegg.com.

They can help you.

Q </div></div>

Nobody thought you knew.

Babble some more now.