The tax man cometh…..
May 5, 2009 by Chinatex
…….and Obama taketh away. Like many of my clients, your company will also be hit by the changes the Obama administration is proposing to the U.S. corporate tax laws. While you should know and understand these changes, there are solutions and they are right here in the Pearl River Delta – Guangdong Province China, Hong Kong and Macau. While business planning generally involves risk, market factors, compliance, labor and other issues, it must also include tax planning and tax strategies for tax avoidance. Old Chinatex helps his clients – those that will listen – legally avoid as much tax as possible. Check out this article below and my comments. As always – Yeehaa!!! Chinatex
Obama to crack down on business taxes
(Agencies)
Updated: 2009-05-04 23:53
WASHINGTON – President Barack Obama plans changes to tax policy certain to be unpopular with corporations with international divisions and individuals who use tax havens. Obama’s two-part plan, which he is slated to unveil at the White House on Monday, also calls for 800 new federal tax agents to enforce the system. New taxes always need new thugs to collect them.
The president’s proposal would eliminate some tax deductions for companies that earn profits in countries with low tax rates, ie: Hong Kong as well as consider US citizens who use tax havens in the Bahamas or Cayman Islands guilty of violating US tax laws. If Obama wins congressional approval for the changes – and he faces a challenge on Capitol Hill – it could deliver $210 billion in tax revenue over the next decade. It always works this way, government overspends and screws up and gets us into such a huge deficit that they have to squeeze us until we bleed.
Officials described the administration’s plan ahead of the announcement on the condition of anonymity so they wouldn’t upstage the president’s remarks. Or so they wouldn’t be dragged out and beaten to death by the pissed off business owners. However, they acknowledged the political challenges facing the plan. The administration won’t seek a complete repeal of overseas tax benefits and, although the rule changes are narrower than some anticipated, business leaders still oppose them as a tax hike. Obama aides countered that the plan is a step toward a massive overhaul of international financial regulations the president has promised. They think we are stupid, so we will just have to find a way to avoid their massive overhaul.
In exchange, Obama said he was willing to make permanent a research tax credit that was to expire at the end of the year and is popular with businesses. Officials estimate that making the tax credits permanent would cost taxpayers $74.5 billion over the next decade. Hmm, take in 210 billion, but leave the 74 billion scraps to the corporations – sounds fair!!
It was small comfort. Companies who shelter profits in international accounts and your companies who are doing business in Asia, stand to lose billions if Obama’s plan becomes law. Under the existing regulation, those companies pay taxes only if they bring the profits back to the US if they keep the profits offshore, they can defer paying taxes indefinitely – and many do. Now they are going to make you claim the monies that you leave in offshore bank accounts. Sound familiar – remember the earlier story i shared with you on the G20 communique. Tax Haven or Heaven?? http://chntxlaw.com/2009/04/tax-heaven-or-haven/
Obama’s plan wouldn’t go into effect until 2011; Obama has said he does not want to tinker with tax revenues until his $787 billion stimulus plan has run its course. He means he doesn’t want to start robbing from Peter to pay for Obama’s spending just yet or he will be run out the country. The proposals, however, were far from complete, and aides said this was just one piece of the administration’s plan for sweeping overhaul.
Administration officials depicted the move as a way to close unfair tax loopholes that encouraged companies to send jobs overseas. Obama paying back the labor unions for his massive campaign war chest. They argued that if it costs the same amount to do business in, say, Ireland as in Iowa, why not do it entirely in Des Moines? Officials said Obama would characterize the move as a way to keep jobs in the United States and fight a system that is rigged against US companies who keep their entire business operation domestic.
Obama also planned to ask Congress to crack down on tax havens and implement a major shift in the way courts view guilt. Unbelievable!! Under Obama’s proposal, Americans would have to prove they were not breaking US tax laws by sending money to banks that don’t cooperate with tax officials. It essentially would reverse the long-held assumption of innocence in US courts. And continue the erosion of our Constitution.
Comments
Feel free to leave a comment...
and oh, if you want a pic to show with your comment, go get a gravatar!
