And are we going to stop giving government subsidies too?
Blackstone CEO Stephen Schwarzman said Tuesday the U.S. would be much better off with a flat tax.
“You don’t have to have just one tax for everyone; you can have one or two and get rid of all deductions,” Schwarzman told CNBC’s “Fast Money Halftime Report,” adding the revenue from a flat tax would be enough to fund the entire U.S. government.
“It tends to work all over the world. One should look empirically: We have a tax code that’s so long … that nobody figures it out. What happens when you get simple numbers, whether it’s 10 percent at the bottom and 20 percent at the top, you get rid of all deductions … it has a sense of working,” he said.
Records in Panama Papers and Swiss Leaks probes tie the wife of Iceland President Olafur Grimsson to offshore companies and accounts
On April 22, CNN’s Christiane Amanpour asked Iceland President Olafur Grimsson: “Do you have any offshore accounts? Does your wife have any offshore accounts? Is there anything that’s going to be discovered about you and your family?”
“No, no, no, no, no,” Grimsson replied. “That’s not going to be the case.”
But secret records obtained by the International Consortium of Investigative Journalists and other media partners show that Grimsson’s spouse, First Lady Dorrit Moussaieff, has had extensive links to the offshore world.
While Grimsson himself doesn’t have an offshore account in the records, First Lady Moussaieff was listed as a beneficiary of five companies and trusts that have held Swiss banks accounts, according to documents obtained from whistleblowers by Le Monde, Suddeutsche Zeitung and ICIJ in the Swiss Leaks and Panama Papers investigations. Her family, including her two sisters, had accounts that together held as much as $80 million in HSBC’s Swiss Private Bank in 2006 and 2007. Dorrit Moussaieff herself appears not to have played a role in most of the holdings.
Carefully timed deals help big money managers skirt dividend taxes in 20 countries, confidential documents show.
German companies are known for paying some of the heftiest dividends among world stocks, one reason U.S. investment giants such as BlackRock and Vanguard are among the biggest holders of German shares.
But Wall Street has figured out a way to squeeze some extra income from these stocks. And German taxpayers pay for it.
A cache of confidential documents obtained by ProPublica and analyzed in collaboration with The Washington Post, German broadcaster ARD and the Handelsblatt newspaper in Düsseldorf details how Wall Street puts together complex stock-lending deals that drain an estimated $1 billion a year from the German treasury.
Similar deals extend beyond Germany, siphoning revenue from at least 20 other countries across four continents, according to the documents, which show how “dividend-arbitrage” transactions — known in the trade as “div-arb” — are structured and marketed as tax-avoidance vehicles.
The trove of transaction logs, emails, marketing materials, chat messages and other communications among deal participants involves a who’s who of the world’s big banks and institutional investors.
In deals like these, some of America’s largest money managers briefly lend out some of their German holdings each year. Those shares are temporarily held by German investment funds and banks that by law pay no tax on German dividends or can claim refunds for tax withheld. The borrowed shares are returned shortly after the dividend is paid.
The Supreme Court announced Monday it would not intervene to allow release of phone records from the late “D.C. madam” Deborah Jeane Palfrey, despite one of her former attorneys claiming the records are “very relevant” to the presidential election.
Though he has repeatedly threatened to release the records if courts do not modify a 2007 restraining order, Montgomery Blair Sibley tells U.S. News he’s not quite sure what he now will do.
“I’m going to sleep on it and seek the counsel of people I trust,” he says. “It’s laundry day anyway, so I’m going to be washing all my soccer uniforms from this weekend.”
Sibley says he likely will decide this week how to proceed and that he’s infuriated the justices refused his request that they stay the restraining order covering the records.
“I’m just trying to figure out how to let the courts know they have lost personal jurisdiction of me as a result of their actions. I’m not asking them to tell us if Nixon and Elvis are still conspiring against the country. This is a legitimate question,” he says.
Bill Gates said investment gains should be taxed at the same level as ordinary income — a bold call for one of the world’s largest investors.
Speaking Monday on CNBC’s “Squawk Box,” Gates said that he’s “pleased” that there is more discussion around changing the tax code. When asked what he would alter, Gates sided with his pal Warren Buffett and said he supports raising the earned income tax credit.
But Gates also said he would raise the tax rate for capital gains — the largest source of income for the richest Americans. The current top tax rate on capital gains is 20 percent (with the highest earners paying an additional 3.8 percent surtax). The top tax rate on ordinary income is 39.6 percent.
“There’s always been the question of whether taxes on capital should be a lot lower than taxes on labor,” Gates said. “I tend to think they should be pretty much the same, and that that’s an opportunity to be a bit more progressive.”
Another day, another settlement…
Bank of America Corp reached a $190 million settlement with a federal home loan bank over four mortgage-related complaints, according to a securities filing on Monday.
The bank had accrued “substantially all” of the settlement amount previously, Bank of America said in a filing with the U.S. Securities and Exchange Commission. The settlement was dated on April 25.
The litigation was started by the Federal Home Loan Bank of Seattle, which later merged into the Federal Home Loan Bank of Des Moines.