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THE SOVEREIGN SOCIETY OFFSHORE A-LETTER
Your Link to Freedom, Prosperity & Privacy in the Offshore World
Tuesday, September 17, 2002 - Vol. 4 No. 94
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In This Issue:
* COMMENT: Political Blowhards.
* OFFSHORE: Swiss Silence Gold. Jersey Bank Squeals. Channel Islands Privacy Threat. Hong Kong Link. Caymans Dual Criminality Tax Policy. Grenada Banks Shut. Bermuda Defense. BVI Boom. Nevis Independence.
* WEALTH: IRS Abuse Forgotten? Bush IRS Targets Rich. Wealthiest Americans, Nations. Investment Boom in Asia, Australia. World Insurance Pushed to Limit; Rates Up. Paul: Abolish the Fed!
* PRIVACY & RIGHTS: Australian Wiretaps. Restrictions Will Last Long.
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* COMMENT: Political Blowhards.
Dear A-Letter Reader: A few days back a magazine called 'The American Prospect' carelessly published an article by one of its 'interns' which attempted to indict The Bahamas for allowing US corporations to move and re-incorporate there for tax avoidance.
The kid didn't know Bahamas from Bermuda, or that The Bahamas has no tax treaties with the US that would provide any tax benefits for US corporate 'inversions' -- as they are now called. I don't really expect summer interns to know enough to pontificate authoritatively about complicated international tax and trade issues, but one might expect more from members of the US Congress. But not in an election year apparently.
The Washington pols think they have a hot re-election issue in offshore corporate inversions, so they've set about beating a dead horse to death. The amount of ignorant twaddle emitted from Capitol Hill on this issue does get a bit noisome. Uninformed news media is not much better. As we all know by now, US tax laws (written by that same US Congress), allow American companies to avoid a significant amount of corporate taxes by keeping foreign earned income offshore in separate entities.
Using so-called 'double taxation treaties,' (also approved by the US Senate), business can save millions, thus increase American shareholder profits and create US jobs. And they do pay US taxes on US earnings. Instead of repealing these tax laws, Congress dramatically has set about denying government contracts to a select list of ex-US companies who 'inverted.' This allows political blowhards to beat their chests and proclaim they are stopping unpatriotic tax evasion by Big Business.
They never explain how this works, however. Bull-loney. If you want the truth about this, about how Congress is killing American jobs, study the LINKS below, especially Dan Mitchell's always impressive memos on this topic. So should a demagogic Congress.
That's the way that it looks from here.
BOB BAUMAN, Editor
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COMMENT LINKS:
* My Tax Paradise. (Factually incorrect hatchet job). American Prospect.
LINK: http://www.prospect.org/print/V13/18/pein-c.html
* US Congress 'Inversion Amendments' Are Political. Tax-News.com
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=9394
* Battle Against Fiscal Protectionism. Dan Mitchell CFP Memo. LINK: http://www.freedomandprosperity.org/memos/m09-13-02/m09-13-02.shtml
* Corporate Expatriation Protects American Jobs. Mitchell. CFP. LINK: http://www.freedomandprosperity.org/update/u09-13-02/u09-13-02.shtml#3
* Punishing American Taxpayers. Wichita Falls (TX) Times. LINK: http://www.trnonline.com/stories/09142002/editorial_page_columnists/33988.shtml
* Corporate Inversions: Issue & FAQ. Tax Foundation
LINK: http://taxfoundation.org/reincorporation.html
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CORRECTION:
About the Battle of Antietam, in Friday's A-Letter I wrote: "26,134 men were killed, wounded, or missing in one single day of bloody carnage." That was correct. I also said "over 23,000 died, the greatest one day loss of life in all American encounters in any war.' The actual total dead exceeded 6,500.
See LINK: http://www.sun-sentinel.com/news/nationworld/nation/wire/sns-ap-antietam-18620916sep16.story
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* OFFSHORE *
SWISS SILENCE IS STILL GOLDEN Time (Europe) looks at the state of Switzerland's bank secrecy.
LINK: http://www.time.com/time/europe/magazine/article/0,13005,901020916-348968,00.html
* U.S.-Swiss anti-terror cooperation increasing.
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=9379
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BANK OF IRELAND (JERSEY) TELLS ON TRUST CLIENTS Trust investors are turned in to UK and Irish tax collectors.
LINK: http://icliverpool.icnetwork.co.uk/0100news/0100regionalnews/page.cfm?objectid
=12195825&method=full&siteid=50061
* Jersey suffering from lack of investor confidence.
LINK: http://money.telegraph.co.uk/global/main.jhtml?view=DETAILS&grid=&targetRule=5&xml=
%2Fglobal%2F2002%2F09%2F09%2Ffjers09.xml
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U.K. THREATENS CHANNEL ISLANDS FINANCIAL PRIVACY UK Proceeds of Crime Act disrupts traditional financial secrecy.
LINK: http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/
FullStory&c=StoryFT&cid=1031119339721
* GUERNSEY says it proves there was no bin Laden link to island. LINK: http://www.tax-news.com/asp/story/story.asp?storyname=9373
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HONG KONG DENIES END OF DOLLAR LINK Pegging of the Hong Kong dollar to the US dollar will continue.
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=9393
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CAYMAN ISLANDS LEADER SAYS NO TAX SURRENDER GEORGE TOWN, C.I. No bowing to EU tax directive and continued dual criminality rule for tax evasion; but what about the US IRS treaty?
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=9374
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GRENADA SHUTS MORE OFFSHORE BANKS ST. GEORGE'S: Four more licensed banks closed in continuing clean up. WSJ Online Subscribers only
LINK: http://online.wsj.com/article/0,,BT_CO_20020913_006903,00.html
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BERMUDA GOVERNMENT DEFENDS POLICY HAMILTON: Says it's fighting US corporate inversion attacks.
LINKS: http://www.theroyalgazette.com/apps/pbcs.dll/article?Date=20020912
&Category=BUSINESS&ArtNo=109120022&Ref=AR
http://www.tax-news.com/asp/story/story.asp?storyname=9387
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BRITISH VIRGINS PROSPER SINCE PANAMA INVASION When Bush I invaded Panama in 1989, BVI was a beneficiary.
LINK: http://property.telegraph.co.uk/property/main.jhtml;$sessionid
$0FOGT1PSTV5HNQFIQMFSFFOAVCBQ0IV0?xml=/property/2002/09/11/ptort07.xml&sSheet=
/property/2002/09/11/ixpmain11.html
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NEVIS STILL WANTS INDEPENDENCE CHARLESTOWN:
Independence movement still alive and well.
LINK: http://www.caymannetnews.com/stories.html#Region1
And the offshore financial sector is doing OK too.
LINK: http://www.caymannetnews.com/stories.html#Region3
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* WEALTH *
I.R.S. ABUSE, OPPRESSION FORGOTTEN Agency reverts to brutal enforcer as politicians suffer from amnesia. LINK: http://www.csmonitor.com/2002/0916/p17s01-wmgn.html
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BUSH I.R.S. TAKES AIM AT THE RICH Lame duck IRS commissioner targets high income Americans.
LINKS: http://www.washingtonpost.com/wp-dyn/articles/A10358-2002Sep12.html http://www.nytimes.com/2002/09/13/business/13TAX.html
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I.R.S. WANTS TO LAY LOW THE RICH Tart commentary by Lew Rockwell on the US Tax Code.
LINK: http://www.lewrockwell.com/rockwell/laylow.html
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FORBES LIST OF WEALTHIEST AMERICANS 400 richest US persons have lost billions.
LINK: http://www.forbes.com/home/2002/09/13/rich400land.html
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WHICH ARE THE RICHEST E.U. NATIONS? OECD tells us, using per capita income as the measure. LINK: http://www.thisislondon.co.uk/dynamic/news/business_story.html?
in_review_id=696570&in_review_text_id=669781
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OFFSHORE INVESTMENT IS NOW THE PLACE TO BE It looks a lot brighter, says Business Week.
LINK: http://www.businessweek.com/magazine/content/02_36/b3798133.htm
* AUSTRALIAN stocks, Asian real estate are attractive.
LINKS: http://www.feer.com/articles/2002/0209_19/p042money.html http://www.feer.com/articles/2002/0209_19/p046money.html
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WORLD INSURANCE INDUSTRY PUSHED TO THE LIMIT 9/11 claims, pay outs have wrecked profitability study says.
LINK: http://www.swissinfo.org/sen/Swissinfo.html?siteSect=161&sid=1329643
* Insurance rates and premiums are skyrocketing.
LINK: http://www.msnbc.com/news/806958.asp?cp1=1
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INVESTORS' FURY FUELS A LEGAL BANDWAGON Stock market crash has shareholders' suing everybody, lawyers smiling. LINK: http://www.nytimes.com/2002/09/15/business/15SUIT.html
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REP. RON PAUL SAYS ABOLISH THE FED The Texas congressman says end the Fed, goodbye Greenspan
. LINK: http://www.lewrockwell.com/paul/paul53.html
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* PRIVACY & RIGHTS
* AUSTRALIAN POLICE LEAD IN WIRETAPPING 20 times the US police wiretap rate. LINK: http://www.news.com.au/common/story_page/
0,4057,5105840%255E1702,00.html
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RESTRICTIONS ON U.S. FREEDOM MAY LAST FOR YEARS ACLU says public unaware that anti-terror curbs curb liberties.
LINK: http://www.newsday.com/news/nationworld/wire/
sns-ap-aclu-leader0915sep14.story
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