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August 6, 2012 6:26 AM Age: 8 yrs
Taxing Matters!Category: Larry Checco
Source: Larry Checco
Billionaire hotelier Leona Helmsley is alleged to have said: “Only little people pay taxes.”
Although the tabloids' "Queen of Mean" went to her grave denying she ever spoke those words, she should have taken credit. It turns out she was mostly right.
To no great surprise, a recent Time magazine article stated that the world’s wealthiest people for years have been using offshore tax havens (such as the Cayman Islands and Switzerland) to avoid paying taxes.
It’s not always illegal, but it sure does hurt government coffers—and us little folk left behind to foot the bill.
The U.S. Treasury, for example, loses an estimated US$100 BILLION in tax revenues each year to offshore tax havens, according to the Time article. That’s enough to annually fund the food stamp program, Head Start and the Corporation for Public Broadcasting, -- and still have nearly $15 billion left over for legislative pork.
But tax avoidance is certainly not restricted to the U.S., alone.
According to former McKinsey & Co Chief Economist James Henry, in a report he recently produced for the Tax Justice Network, “There may be as much as US$32 trillion of hidden financial assets held offshore by high net worth individuals.”
The report -- The Price of Offshore Revisited -- went on to say: “We consider these numbers to be conservative. This is only financial wealth and excludes a welter of real estate, yachts and other non-financial assets owned via offshore structures."
And what three private banks handle the most assets offshore on behalf of the global super-rich? They be UBS, Credit Suisse and Goldman Sachs.
So let’s get this straight
People who earn big bucks in their home countries, either legally—or in some cases, illegally—squirrel them in overseas tax havens to avoid paying taxes. How patriotic!
Unfortunately, I’m one of the little guys.
For the past 30 years I’ve earned a modest—and honest—living as a self-employed, one-man consulting firm. As such, I pay 15% right off the top to Social Security (both the employer’s and employee’s contributions). After some minor deductions, my total tax liability is upwards of 30% -- in contrast to millionaire/billionaire hedge fund managers who pay 15%--and are looking to elect a president who will further reduce their tax liability.
But, hey, at least they’re paying something. We’re still not sure about the guy they want to elect.
Do I understand the necessity of paying taxes? Yes.
· The wealthy don't build roads or repair our bridges and tunnels -- government does.
· The wealthy don't build our courts and support our justice system -- government does.
· The wealthy don't maintain our parks and public spaces -- government does.
· The wealthy don't work to ensure that we have clean air to breathe and clean water to drink -- government does. And on it goes.
Is government often inefficient? Yes.
Is it often mismanaged? Yes.
Can we do without it? Absolutely Not!
The answer is not to abandon government; it's to repair it as best we can. That may take some doing, but it beats reverting to anarchy.
I don’t want tax dodgers, be they avoid paying taxes legally or illegally, driving on my highways or breathing my clean air or drinking my clean water. I don’t want them using my justice system or hiking in my public parks. Or being defended by a military they don’t support.
Bottom line: If you don’t want to pay taxes, follow your money, and go live in Switzerland or the Cayman Islands or Bermuda.
And don’t let the door of your private jet hit you in the butt when you leave!
Contents © 2012 by Larry Checco - All Rights Reserved
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