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THE SOVEREIGN SOCIETY OFFSHORE A-LETTER
Your Link to Freedom, Privacy & Prosperity in the Offshore World
Friday, July 22, 2005 - Vol. 7 No. 147
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In This Issue:
* COMMENT: OECD in Crisis, Hopefully.
* OFFSHORE: Brit Tax Havens Upset. Narrow Canal. Bermuda Blackout.
* WEALTH: China Yuan Yawn. Court Rules on FLPs. IRS Crack Down/Up.
* PRIVACY & RIGHTS: Terrorism: Why & What To Do About It.
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COMMENT: OECD in Crisis, Hopefully.
Dear A-Letter Reader:
"Everybody in the OECD says that the OECD is in crisis. We need to inject some new dynamism into the organization to overcome its inertia," an unnamed diplomat told the Financial Times this week.
Well, dear readers, lovers of liberty can only hope that the Organization for Economic Co-operation and development (OECD) is in trouble. This tax exempt Paris think tank, in spite of its sometimes useful research, has
served as the chief political propagandist for leftist attacks on tax havens, financial privacy and low taxes and tax competition in general.
The OECD claims to be the successor to the Organization for European Economic Co-operation (OEEC) that began in 1947 to support the US Marshall Plan for the reconstruction of Europe after World War II. In 1961 the G-7 major nations created the OECD with a high sounding mandate to help "achieve sustainable economic growth and employment while maintaining financial stability."
In our view, the OECD has far too often played the bully, especially in its clumsy attempts to crush tax havens and force a uniform system of high taxes worldwide. In pursuing its dictatorial goals the OECD is doing the bidding
of its 30 member nations, many of which, like France and Germany, are high tax, socialist welfare states bent on ringing every last dollar, pound or euro out of taxpayers to finance continuing deficits and statist economies.
The OECD instrument of choice in their pro tax campaign has been the phony 'harmful tax competition' blacklist of nations with low taxes.
To prop up their demands, the OECD spun off the Financial Action Task Force (FATF), supposedly devoted to fighting money laundering and terrorist cash, but more concerned with destroying financial privacy. OECD/FATF want unrestricted, automatic government access to any and all financial accounts anywhere in the world.
The irony in all this is that the OECD is nothing more than a paper tiger based on member agreement. It's not even a government or international agency, in the sense that the UN has legal standing.
Its depends for impact on an unquestioning, sympathetic left-wing news media.
With an almost religious fervor, OECD bureaucrats presume to tell people and governments how they should conduct themselves by, as they claim, "setting standards and creating values for the entire world."
A tall and very presumptuous order for the OECD's 2000 bureaucrats, the salary of everyone of whom is tax exempt because of their coveted diplomatic status. Housed in a fine Parisian mansion that once belonged to the Rothschild family, the Château de la Muette, the OECD's annual budget of over is $300 million, US taxpayers footing 25% of the cost.
There's been a move in the US Congress to cut OECD funds and now may be the time. As Ronald Reagan used to say, the nearest thing to eternal life on earth is a government agency. The demise of this nosey international bureaucracy is long overdue.
That's the way it looks from here.
Bob Bauman, Editor
PS: We explain the OECD and lots more in
'Where to Stash Your Cash Legally" - Click here for more:
LINK: http://www1.youreletters.com/t/162357/2353496/777749/0/
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COMMENT LINKS:
* Six in race to become next head of OECD.
LINK: http://news.ft.com/cms/s/95e17cd2-f964-11d9-81f3-00000e2511c8.html
* OECD's Dishonest Campaign Against Tax Competition.
LINK: http://www.freedomandprosperity.org/press/p05-31-04/p05-31-04.shtml
* Official OECD web site.
LINK: http://www.oecd.org/about/0,2337,en_2649_201185_1_1_1_1_1,00.html
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* FROM THE EDITOR'S DESK:
OFFSHORE:
* GIBRALTAR EU TAX EXEMPTION ROW HEATS UP
As we reported this week, the EU tax directive may be in danger of ending before it gets started, as British tax havens, the Isle of Man, Jersey and Guernsey, threaten to pull out. They're more than upset that Gibraltar has
escaped from the EU tax directive, and they have not - yet. Stay tuned as the battle lines form.
* Gibraltar accused of taking advantage of loophole
LINK: http://www.panorama.gi/updates.htm#Gibraltar_accused
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* ECONOMIST COMMENTS ON PANAMA CANAL
You've read about it here for months, but The Economist yesterday let the world know about the holdup in plans to expand the Panama Canal.
No Panama national referendum for now, as the Torrijos government tries to mediate need for pension reform against unions that want their uncut pension checks early and often. 90 days of talks are underway.
* Panama Canal: expansion plans hit political problems.
LINK: http://www.economist.com/world/la/displayStory.cfm?story_id=4199077
* Panama prepares for Caribbean nations summit July 29.
LINK:
http://www.plenglish.com/article.asp?ID=%7BF6B4E42A-E800-459C-8770-0D52604BA2FD%7D&language=EN
* Caribbean accounting body steps up anti-money laundering drive.
LINK: http://www.jamaica-gleaner.com/gleaner/20050721/business/business1.html
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BERMUDA: THE WEEK THE LIGHTS WENT OUT
HAMILTON: You may not have known it, but a week ago a power plant fire cut power for much of the island of Bermuda, a blackout that lasted for four days. That didn't faze the offshore financial center; it made do.
* International companies keep working.
LINK:
http://www.theroyalgazette.com/apps/pbcs.dll/article?AID=/20050718/BUSINESS/107180118
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WEALTH:
* CHINA REVALUES YUAN - YAWN!
* From SEAN BRODERICK, Sovereign Society investment guru: "The market was 'shocked' yesterday when China revalued its currency, the yuan, by 2.1% against the dollar, far lower than the minimum 10% the US Congress demands. We'll see more revaluation of the yuan down the road."
For the inside story, see Sean's Comment in Monday's A-Letter.
* China revaluation:
LINK: http://www.chinarevaluation.com/
* China Will No Longer Peg Currency to US Dollar.
LINK: http://www.nytimes.com/2005/07/21/business/worldbusiness/21cnd-china.html
LINK:
http://www.washingtonpost.com/wp-dyn/content/article/2005/07/21/AR2005072100922.html
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* U.S. RULING AFFECTS FAMILY LIMITED PARTNERSHIPS
A federal court has defined new restrictions on FLPs, one of the most popular domestic US tax savings devices. The new rules will require less donor control and more careful accounting.
* US Appeals Court clarifies rules on family limited partnerships.
LINK: http://www.nytimes.com/2005/07/20/business/20irs.html
* Appeals Court Supports IRS On Estate Tax Planning
LINK: http://www.tax-news.com/asp/story/story_open.asp?storyname=20551
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* I.R.S. TAX CRACK DOWN MAY CRACK UP
IRS observers say in spite of claims of stepped up tax enforcement and collection of billions in tax shelter back taxes from executives, the IRS is suffering from reduced budgets and not enough staff. In 2004 IRS pursued only 18% of known cases of abusive tax shelters and failed to collect at least $447 million.
* Cracks In The IRS Crack Down
LINK: http://msnbc.msn.com/id/8657316/
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PRIVACY & RIGHTS:
* TERRORISM: WHY -- AND WHAT TO DO ABOUT IT
Is it time for America to consider a strategic reassessment of our policy of foreign interventionism, occupation, and nation building?
Ron Paul thinks so.
* US Rep. Ron Paul ponders why terrorist do what they do.
LINK: http://www.lewrockwell.com/paul/paul262.html
* The London Bombings: How the US and UK Should Respond.
LINK: http://www.heritage.org/Research/Europe/bg1871.cfm
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THE SOVEREIGN SOCIETY OFFSHORE A-LETTER.
* Bob Bauman, Editor * Daniel Aponte, Jr. Editorial Asst.
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