Sunday, March 23, 2014

Proposed Legislation will Shine More Light on Lobbying, Self-Dealing in Congress

Last week, US Congressman Mike Quigley (D-IL) introduced the Transparency in Government Act of 2014, a bill "to amend the Ethics in Government Act of 1978, the Rules of the House of Representatives, the Lobbying Disclosure Act of 1995, and the Federal Funding Accountability and Transparency Act of 2006 to improve access to information in the legislative and executive branches of the Government, and for other purposes." I am always worried about those other purposes, because funny things tend to get slipped into law this way, but the bill is interesting.

Government Executive Oversight calls it "a grab-bag transparency bill" that would "use technology to boost public oversight of program spending, standardize agency reporting on use of the Freedom of Information Act, shed greater light on lobbying and add new requirements for judges to disclose financial investments," as ell as "toughen online disclosure requirements for lawmakers’ personal finances, office expenses, gift reports and foreign travel." All that sounds like it is worth doing.

I especially like the idea of putting completed FOIA requests online, but would like to see the law go even further: if it's FOIAble it ought to be automatically disclosed and available to the public, not have to wait for individuals to file applications. I realize that this presents administrative costs but FOIA is a constructed barrier that unnecessarily imposes costs on individuals to release information that is of public benefit. If a government is producing thousands of pages of ultimately public documents I don't see why the individual must be forced to compel publicity in the vast majority of cases; the opposite should be true.

The other main part of the bill is its attempt to make public officials more honest about their backroom dealings, including politicking and rule changing.

Finally it's about time for another attempt to stop Congress from inside trading after they "quietly" undid the 2012 Stop Trading on Congressional Knowledge (STOCK) Act which was meant to curb this behavior. Congress, it seems, was worried that transparency would expose members to identity theft. This is something that Congress worries about a lot when it comes to themselves but seems incapable of determining how to stop when it comes to those not in Congress.

It is nice to see at least one Congress person push for transparency and accountability in Congress, but given past experience there is unfortunately all too much room for doubt that any reforms will stick even if they pass. I always hope to be proven wrong in this skeptical view.

Scott Wilkie: Next Wednesday at McGill Law

I am very pleased to be hosting international tax guru Scott Wilkie at McGill Law next Wednesday, where he will deliver a talk on current topics in international taxation, more info here. The talk is scheduled to commence at 12:30 pm; members of the public are warmly welcomed.

Location: McGill Faculty of Law, 3644 Peel Street,
Old Chancellor Day Hall, Room 16.

Date and Time: Wednesday, 26 March, 12:30–14:00.

This event is free and open to the public.

Tuesday, March 18, 2014

Next Week at NYU: Tax and Corporate Social Responsibility Symposium

I'll be taking part in this symposium on corporate taxation next Tuesday at NYU. Here is the description:
Tuesday, March 25, 2014  |  9:00 AM - 12:00 PM
D'Agostino Hall, Lipton Hall 
This symposium will feature two panels, “Should Corporations Pay Tax?” and “Should Corporate Tax Returns Be Public?”   
Participants include Reuven Avi-Yonah (Michigan), Allison Christians (McGill), Peter Barnes (Duke), Michael Schler (Cravath), Joshua Blank (NYU), Helen Scott (NYU), David Kamin (NYU), and possibly others.   
The event will be co-hosted by the Graduate Tax Program and the NYU Journal of Law & Business.   
It will take place from 9:15 AM to 12:30 PM on March 25th in Lipton Hall, D’Agostino Hall at NYU Law School, located at 110 West Third Street.
Additional info here, including this description:
From the enactment of the corporate excise tax in 1909 to the present, the corporate tax in the United States has generated intense debate.  Topics at the center of this debate have ranged from the fundamental purpose of the tax to moral obligations of corporations to pay tax to tax transparency and accountability.  This half-day symposium will continue the discussion by addressing two questions:  Should corporations pay tax?  And should corporate tax returns be public?  Each panel will feature leading tax and corporate law scholars and distinguished practitioners.  Participation from the audience in the discussion will be encouraged.
My recent writing on these subject includes a short essay entitled "How Starbucks Lost its Social License — And Paid £20 Million to Get it Back" on Starbucks' tax-dodging related image problems in Europe, a book chapter entitled "Tax Activists and the Global Movement for Development Through Transparency," on the global corporate tax transparency movement, and an article article entitled "Drawing the Boundaries of Tax Justice" which analyzes the fundamental justice questions surrounding the taxation of corporations (as well as humans).

Is It Time for a Taxpayer Bill of Rights? Tax Analysts Conference: March 27

Tax Analysts is hosting a conference on March 27 in Washington DC that is of broad interest. The schedule includes National Taxpayer Advocate Nina E. Olson, as well as Christopher S. Rizek of Caplin & Drysdale and former Treasury Deputy and Acting Assistant Secretary for Tax Policy Alan J. Wilensky.

Chris Bergin of Tax Analysts & Forbes will be hosting and he has a number of articles on the problems of taxpayer rights and IRS accountability that should be read by everyone who cares about tax policy. Here are just a few:

It should be noted that, of course, the IRS already does have a declaration of taxpayer rights. However, it is declaratory and not legal in nature, so apparently has no legal effect (though as far as I know, this has not been tested through litigation). The taxpayer advocate has been calling a legislated version for a long time, as I discuss here

Conference details:  

Thursday, March 27, 2014
9 - 11 a.m.  
Continental breakfast at 8:30 a.m.
The event is free and seating is limited.

Ronald Reagan Building
Polaris Suite
1300 Pennsylvania Ave. NW
Washington, DC 20004

Cockfield on Taxpayer Privacy and FATCA

Professor Art Cockfield has two upcoming talks of note, on the topic of "The Privacy Implications of the Foreign Account Tax Compliance Act (FATCA)". The first talk will be held on Friday 21 March starting at 3:15pm at the University of Toronto (Faculty Club) as part of the CCLA 'Pathways 2 Privacy' conference. The second one will be held on Sunday, March 30 starting at 10 am at Glendon College, York University, as part of the 19th Annual International Studies Symposium. Professor Cockfield's remarks will be based on the Finance Department submission he and I co-authored, which you can find here.

Thursday, March 13, 2014

Tomorrow at McGill Law: Panel on Distributive and Labour Justice

Catherine Lu of McGill and Pablo Gilabert of Concordia will be presenting on the topic of global principles of distributive and labour justice tomorrow at 12:30 pm as part of McGill Law's Speaker Series on Economic Justice, sponsored by the Centre for Human Rights and Legal Pluralism. I will be moderating the discussion. This event is free and open to all, details:

Date: 14 March 2014
Time: 12:30-14:30
Location: Room 609 New Chancellor Day Hall
3644 rue Peel
Montreal Quebec Canada , H3A 1W9

I have started reading Catherine Lu's 2006 book, Just and Unjust Interventions in International Law: Public and Private. In it, she argues that the concept of state-to state intervention as a moral problem rests on an image of sovereignty as privacy, and therefore uses the same imagery of intrusion that we see in the domestic privacy context as a basic element. The domestic case against government intrusion into private affairs of individuals and social groups (family) involves balancing between curbing domestic abuse and government intruding too deeply into family lives.  Lu argues that the same principles animate the question of legitimacy in intervention, making similar normative claims to privacy accorded to families in the domestic realm. Lu thus argues that:
The concept of intervention .. assumes some distinction between private and public domains. In the Westphalian model of interstate relations, the posited sovereignty of states functions like privacy to give states a right to be free from interference by outside parties --especially other states, as well as non citizens, nongovernmental organizations, and even the international community -- in their own internal affairs."
The public/private argument is an interesting and I think controversial position that adds to a discourse about sovereignty that we see being challenged all the time in taxation, including (especially of late) in taxation. Consider the OECD's project on BEPS, the US imposition of FATCA on the rest of the world, the rise of global tax justice activism, the addition of taxation to the corporate social responsibility discourse, and the UN tax group's attempt to change the conversation on transfer pricing. There are many other examples in recent and not so recent history.

It will be interesting to discuss the pressures involved in the area of labour. I have viewed it as essentially necessary for states to trap labour in order to extract enough revenues to pay for the state (in the form of taxation or otherwise). It is clear that governments have come to rely on labour as their primary resource of such revenues over the past century, so cannot let labour move as capital does, footloose and free of obligation.

Video & Audio Resources on Political Theory, Inequality, Finance, and Governance

Russell Haggar, a Sociology and of Government and Politics teacher in the UK, has put together a a visually alarming but very useful "Compendium of Video and Audio Materials for Advanced Level Government and Politics and Sociology Students and for the General Reader," with sections on Political Theory, Welfare and Inequality, Labor Politics, the Financial Crisis, and others. Here is but a sample of what you will find:

  • Stephanie Flanders’ three part series for the BBC: Masters of Money: John Maynard Keynes: Friedrich Hayek: Karl Marx 
  • Laurie Taylor : Thinking Allowed on Capitalism with Ha-Joon Chang and David Harvey
  • Who Owns the World? by Noam Chomsky
  • Why Equality Is better for everyone [Video on The Spirit Level from The Equalities Trust]
  • Gordon Brown and the Financial Crisis [Andrew Rawnsley for Channel 4]
  • RBS : Inside the Bank that ran out of money  
  • Meltdown: The Global Financial Collapse (four part series)
  • 3 Part BBC Series by Michael Cockerell on The Great Offices of State, with part 3 entitled The Secret Treasury
Many, many more resources at the link.

Tuesday, March 11, 2014

This Sunday at McGill: Info Session on FATCA

This Sunday there will be a Foreign Account Tax Information Act (FATCA) Information Session at the Faculty of Law at McGill, featuring John Richardson from Toronto and Andrew Grossman from London (UK); each has extensive experience with U.S. taxation issues. The session will be geared toward those with US status and the speakers will discuss issues of disclosure, compliance, and other obligations raised by this legislation.

This event is free and open to the public. Please note that it is St. Patricks' Day so attendees are advised to plan their travel arrangements accordingly. Details:

16 Mar 2014 
12:00 to16:00
Location: Chancellor Day Hall, Maxwell Cohen Moot Court (NCDH 100)
3644 rue Peel Montreal Quebec Canada, H3A 1W9

Monday, March 10, 2014

Christians & Cockfield: Submission to Finance Dept on FATCA in Canada

I have just posted on SSRN a submission to the Canadian Finance Department co-authored by myself and Professor Arthur Cockfield of Queen's University. Here is the abstract:
The United States enacted a tax reform in 2010 known as the Foreign Account Tax Compliance Act (FATCA), which will impose an extensive third-party monitoring and disclosure regime on financial institutions around the world in an effort to “smoke out” American tax cheats and expose their undeclared foreign assets to the U.S. Internal Revenue Service (IRS). The flow of information from Canadian financial institutions directly to the IRS that is required by FATCA would violate a number of laws in Canada. Accordingly, the United States has requested changes to these laws. The Canadian government now seeks to accommodate these requests in the form of an “intergovernmental agreement” (IGA) with the United States, which will be enacted into law as the Canada–United States Enhanced Tax Information Exchange Agreement Implementation Act (the Implementation Act) pursuant to a proposal released for comment by the Department of Finance. The Department of Finance invited public comments on these documents. We examined the proposed Implementation Act and the IGA and we find that they raise a number of serious issues ranging from likely constitutional violations to violations of international law. We submit these comments in the hope that they will help lawmakers and the public understand that FATCA, while intended to catch tax evaders, is poised instead to impose serious and unjustified harms on people who live around the world as non-resident U.S. citizens and green card holders, as well as their family members and business associates.
I know that some of my good friends and colleagues view FATCA as a net positive step toward a much-needed global automatic information sharing regime, and some have not understood my reasons for caution. I hope that this submission will help explain some of these reasons.

I want to add that in my view, the Department of Finance unnecessarily inhibited public debate on the impact of the proposed legislation by setting an arbitrarily short period for comments. The agreement itself is complex and must be analyzed in the context of the underlying U.S. law and regulations as well as the more than twenty agreements the U.S. has signed to implement FATCA with other countries. In the little more than one month’s time that the Department of Finance allotted for public comment, these thousands of pages of applicable law and regulations have been augmented by several hundred new pages of guidance from the United States tax authorities, and will be further augmented when the Canada Revenue Agency (CRA) publicly releases its own guidance for Canadian financial institutions.

In restricting the time for Canadian tax practitioners and policy observers to review this lengthy, complex, and fundamentally global regime, the Department of Finance has deprived itself of the opportunity to receive more meaningful and thorough consideration of the many policy and practical issues involved in implementing FATCA in Canada. I hope that the Finance Department will extend its time to receive comments, especially if and when further guidance is issued.

Wednesday, March 5, 2014

Alain Deneault--Paradis fiscaux: La Filière Canadienne/Tax Havens: The Canadian Connection

Alain Deneault, auteur de Noir Canada: Pillage, corruption et criminalité en Afrique, lance son nouveau livre, Paradis fiscaux : La filière Canadienne [Montreal Book Launch]:

* La première séance sur les liens historiques entre le Canada et les paradis fiscaux, à l'Upop.

 Date : Mercredi, 5 mars 2014, 17h
Location: Salle des Boiseries, UQAM Pavillon Judith-Jasmin - Salle des Boiseries
405, rue Sainte-Catherine Est Salle J-2805

Revue de Presse

Voici une vidéo de Deneault, où il discute du livre:

J'ai lu le livre et j'aimerais fournir le commentaire suivant:
C’est avec enthousiasme et plaisir que je recommande le livre d’Alain Deneault, Paradis fiscaux : La filière canadienne. Cet ouvrage aborde une question importante et très actuelle, celle de la concurrence que se livrent les États sur le plan de la fiscalité pour séduire le capital et privilégier certaines industries. Ce faisant, ils imposent au reste de la société des coûts dont on ne mesure pas l’ampleur. 
Deneault dépeint habilement le portrait de ce régime mondial en mettant l'accent sur les acteurs canadiens qui ont facilité sa mise en place. En tant que professeure et chercheuse dans le domaine du droit fiscal, je considère que ce livre est une ressource indispensable; il offre une riche mise en contexte culturelle, sociale et historique dont on a grandement besoin pour comprendre comment la concurrence fiscale est devenue le phénomène mondial qu’on connaît aujourd’hui.
I read the book and was happy to provide the following comment:
I am happy to enthusiastically recommend Tax Havens: The Canadian Connection, by Alain Deneault. The book deals with the timely and important topic of how governments engage in tax competition in order to lure in capital and privilege certain industries, at an unmeasured cost to the rest of the society. Deneault deftly weaves a narrative about tax competition by focusing in on the unique roles Canadian players have had in enabling and facilitating this global landscape. As a tax law professor and scholar, I view this work as an indispensable resource, providing a rich cultural, social, and historical context that is surely needed for understanding how tax competition developed into the global phenomenon it is today.  

Tuesday, March 4, 2014

Apple not solely focused on Shareholder value

Business Insider reports on a recent Apple shareholder meeting, during which a representative from a decidedly far right thinktank asked Tim Cook "to commit on the spot to only making moves that were profitable for the company," to which Cook replied
"When we work on making our devices accessible by the blind, I don't consider the bloody ROI." He said that the same thing [applies] about environmental issues, worker safety, and other areas where Apple is a leader.
This is an interesting comment on the role of corporate social responsibility in shaping how CEOs talk about their management practices. One area where Apple is a leader is in its tax dodging capacity, though perhaps its leadership in this respect is less well known than that associated with its contract manufacturing practices. If those activities are not ROI-focused, it is difficult to know why they form such an integral part of Apple's global business strategy. I continue to look for signs that the aggressive tax planning is becoming anathema to Apple's polished CSR image, but none have yet emerged.