According to The Guardian, President-elect Obama has plans to crack down on international tax havens within weeks after being sworn in as America’s 44th president.
Mr. Obama was one of the signatories of the Stop Tax Haven Abuse Act, a legislation put to Congress last year that blacklisted Jersey, Guernsey, the Isle of Man and 32 other jurisdictions.
The Levin-Coleman-Obama Tax Haven Abuse Act introduced in Feb. 2007, estimated that the total loss to the Treasury Department from offshore tax evasion alone approaches $100 billion per year, including $40 to $70 billion from individuals and another $30 billion from corporations engaging in offshore tax evasion. Key aides to Obama said the President-elect will introduce a law within weeks of taking power against tax evasion making good on his campaign promise to stop the abuse of international offshore tax havens.
Obama advisors estimate the measure, if enacted by Congress in the next session, could raise at least $50 bln a year in lost U.S. tax revenues.
Key measures are likely to include: revealing the beneficial owners of secretive trusts; prohibiting accountants from charging fees on specific tax services; and identifying ‘offshore secrecy jurisdictions’ that ‘unreasonably restrict US tax authorities from obtaining needed information’.
Leading accountancy firms, notes The Guardian, have already started hiring lobbyists in anticipation of a fierce battle to restrict the proposals.
The measures could end years of financial secrecy for international businesses as they move money from one jurisdiction to another. Joe Guttentag, a key figure in the Obama campaign and deputy assistant secretary for international tax in the Clinton administration, along with Professor Reuven Avi-Yonah, who helped frame the tax haven abuse act, are expected to drive the policy through.