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Up to two million people are to have their credit files secretly checked under a crackdown on tax evasion to be unveiled by George Osborne to help raise another £10 billion.
Credit reference agencies will cross-check details of the income people declare on their tax returns against their spending patterns to identify “high” and “medium” risks of both illegal and legal tax avoidance.
People identified to HM Revenue and Customs will then be subject to more detailed investigations. About two million people are expected to be scrutinised under the programme, which may lead to privacy concerns.
HMRC will today unveil the “successful” results of a pilot programme involving about 20,000 people which will now be extended nationally.
Many of those who are expected to be identified are likely to be self-employed workers who have under-declared their income to the authorities.
However, those who have benefited from secret windfalls – such as an inheritance or a bonus – and people with secret offshore accounts could also be highlighted.
Mr Osborne is preparing to deliver the Autumn Statement on Wednesday, in which he is expected to announce another extension to the Government’s austerity programme. Spending cuts and tax rises are now expected to last until at least 2018.
The Chancellor indicated yesterday that he was preparing a new round of welfare cuts – and tax rises for the wealthy – this week. The renewed crackdown on avoidance is also expected to play a key role.
Treasury sources said that “hundreds of millions” are expected to be raised from the greater use of third-party data, such as that supplied by credit reference agencies.
Ministers also wish to encourage more whistle-blowers to come forward with details of offshore bank accounts.
Mr Osborne said: “While most taxpayers are doing their bit to help us balance the books, it is unacceptable for a minority to avoid paying their fair share.”
Danny Alexander, the Liberal Democrat Chief Secretary to the Treasury, added: “It is simply not fair that at a time when most people are making a contribution to balancing the nation’s books, there is a small minority of taxpayers who try to escape their responsibility.”
The Chancellor will this week extend the austerity programme after admitting it is “clearly taking longer” to deal with the country’s debts than “anyone would have hoped”.
The credit-reference scheme is among a series of initiatives to be outlined today to reduce tax avoidance and evasion among wealthy Britons and multinational companies.
Mr Osborne will also announce an agreement with Switzerland which will give the British authorities access to the details of the offshore savings of thousands of Britons.
Information will also be routinely shared between the British and American authorities.
The Treasury is to provide an extra £77 million a year to HMRC over the next two years to increase its investigative capability. The “affluent unit” which targets the wealthy is to take on 100 extra staff.
Meanwhile, a parliamentary committee will today attack HMRC for being “way too lenient” in its treatment of multinational companies.
The public accounts committee will accuse international firms of “insulting” ordinary Britons by funnelling profits off shore.
Yesterday, Starbucks announced it had entered talks with HMRC about paying more tax in the UK following reports it had paid just £8.5 million tax on its British profits since 1998. Story Continued:
– How soon before Obama takes the European method to go after your money. PdC
Amazing how a reelection can reshape an incumbent’s thinking about many things. Now safely ensconced in the White House for 49 more months, the Obamas have decorated the place with 54 Christmas trees this year.
Even allowing for the usual Washington excesses with taxpayer money, that’s a whole grove of Christmas trees.
“We have 54 trees in the White House,” an excited Michelle Obama proudly told visitors the other day. “54! That’s a lot of trees.”
In fact, the Obamas’ 54 trees this year are almost 50% more Christmas trees than last year. That was during the campaign before Obama whispered a reminder to the Russians that he had to be careful until Nov. 6, when a victory would give him more “flexibility.”
Now, how much carbon do you suppose those 54 trees could be sequestering had they not been chopped by this green president?
And no wonder Obama talked over the weekend about addressing tax increases before any of that annoying business about cutting spending to address this thing called the national debt, now having soared past $16.3 trillion..
In addition to 54 Christmas trees, Michelle Obama has overseen the placement of thousands of ornaments in public rooms. Many of the ornaments celebrate the Obama family dog, Bo, who seems to have become the First Family’s favorite symbol of Christmas. Other decorations, including on the more prominent trees, were made by children in schools on U.S. military bases.
There’s several hundred yards of garlands and wreaths all over the hallways and rooms. And, of course, a traditional gingerbread house that has working chandeliers and weighs about 300 pounds.
Last year, according to Mrs. Obama, some 90,000 visitors viewed her White House decorations. The irony is this year the main residents of the White House won’t be there for most of the holiday period and for both major holidays.
According to notices distributed to residents of an exclusive waterfront neighborhood in Hawaii, they can expect to enjoy restricted access and other inconveniences to their homes and normal lives from Dec. 17 through Jan. 6. That’s about a 50% longer holiday vacation than last year.
The inconveniences stem from security requirements for the vacationing Obamas and a large number of their accompanying friends. Obama’s staff will have to put up with rooms in a nearby luxury hotel.
The Coast Guard will be patrolling surrounding canals. Navy SEALs will be doing whatever SEALs do on security detail. The Secret Service and local police will man numerous area roadblocks and perhaps even some bushes. Story Continued:
House Republican leaders have made a counteroffer to President Obama in the fiscal cliff negotiations, proposing to cut $2.2 trillion with a combination of spending cuts, entitlement reforms and $800 billion in new tax revenue.
The leaders delivered the offer to the White House on Monday with a three-page letter signed by Speaker John Boehner (R-Ohio), Majority Leader Eric Cantor (R-Va.), and four other senior Republicans, including Rep. Paul Ryan (R-Wis.), the party’s just-defeated vice presidential nominee.
Republican officials said the offer was based on a proposal outlined by Erskine Bowles, the former chief of staff to President Bill Clinton, in testimony last year before the congressional “super-committee” on deficit reduction. That offer is distinct from the widely-cited Simpson-Bowles deficit plan released two years ago.
The GOP offer is a response to Obama’s opening bid, which called for $1.6 trillion in tax increases and reducing the power of Congress to block an increase in the debt ceiling.
“What we are putting forward is a credible plan that deserves serious consideration by the White House,” Boehner told reporters in a brief appearance at the Capitol. He said he hoped the administration would respond in a timely manner.
The Speaker last spoke to Obama on Wednesday and indicated he did not plan to personally present his offer to the president. “I think the letter’s appropriate,” he said.
Boehner is scheduled to attend the White House holiday party on Monday evening. Asked if he might speak to Obama there, the Speaker smiled and replied: “I might run into him.”
The Republican counteroffer does not include an increase in the debt ceiling, but a GOP aide said the party remained open to negotiating additional borrowing authority for the Treasury before the end of the year. The nation is expected to reach its borrowing limit by mid-February at the latest. Story Continued:
· Obama Aide: With These Republicans, ‘There’d Still be Slavery’ Today – MSNBC host Chuck Todd reported that a “very smart White House aide” told him that “with this Republican, with the way politics of Washington are today, there’d still be slavery.” Watch here:
“You’re going to like this,” MSNBC host Chuck Todd said this morning on TV. “So, I threw the Lincoln analogy at a close aide to the president last week, and he said, ‘You know, with this Republican, with the way politics of Washington are today, there’d still be slavery. Lincoln wouldn’t have been able to navigate the polarization between the media between this–‘ It was an interesting and depressing observation from this very smart White House aide.” Story Continued and to watch the video:
Another controversy has been raised in the George Zimmerman murder case after attorneys for the former neighborhood watch commander showed a photo, taken by the Sanford Police Department, of Zimmerman bloodied in the face the night he killed 17-year-old Trayvon Martin.
The digital photo shows a bloody-nosed Zimmerman with a scratch on his forehead as he sat in the backseat of a police car.
Zimmerman’s supporters say the photo backs up his claim of self-defense. He said Martin attacked him as they encountered each other in a Sanford subdivision, forcing the shot that killed Martin.
Martin had been staying at the home of his father’s fiancé in a gated community of The Retreat at Twin Lakes in Sanford that weekend.
While watching a game, the teen decided to walk to a convenience store. On his way back to the townhome, Martin was spotted by Zimmerman, the leader of the community’s neighborhood watch.
Zimmerman followed and confronted Martin, despite being warned by a police dispatcher that officers had been called and that he did not need to approach the teen.
Martin and Zimmerman reportedly fought and Zimmerman shot the unarmed teen. Zimmerman claimed that he acted out of self-defense and is pleading not guilty based on Florida’s “Stand Your Ground” law.
The black and white photocopy of the image was disclosed during discovery of the second-degree murder trial. A full color copy was later located and shared on the internet.
The date for Zimmerman’s trail is set for June 10, 2013. A status hearing is set for December 10. Story Continued:
· Change on veterans’ gun rights lights fire – Coburn wants decisions by judge rather than VA for impaired troops
A major defense-spending bill hit an unexpected bump on its journey through the U.S. Senate over an amendment on veterans’ gun rights, which devolved into a heated floor debate and foreshadows a potential battle over Democrats’ vows to tweak the filibuster rules in the clubby, traditionally collegial body.
Sen. Tom Coburn, Oklahoma Republican, wants veterans who have been deemed “mentally incompetent” to have their cases adjudicated by a judge — rather than the Department of Veterans Affairs, as happens currently — and argued that veterans who simply cannot support themselves financially are needlessly given the label and, as such, cannot buy or possess firearms.
“We’re not asking for anything big,” Mr. Coburn said Thursday evening on the Senate floor. “We’re just saying that if you’re going to take away the Second Amendment rights … they ought to have it adjudicated, rather than mandated by someone who’s unqualified to state that they should lose their rights.”
The late-night tussle served to pick at the scab of the ongoing debate over Senate Majority Leader Harry Reid’s bid to reform the chamber’s filibuster rules to place limits on the minority party’s ability to hold up debate on legislation, however.
Sen. Charles E. Schumer, New York Democrat, objected to Mr. Coburn’s proposal once he found out it was part of a package of amendments to the 2013 National Defense Authorization Act the body was to vote on.
“I love our veterans; I vote for them all the time, they defend us,” Mr. Schumer said. “But if you are mentally ill, whether you’re a veteran or not, just like if you’re a felon, if you’re a veteran or not, and you have been judged to be mentally infirm, you should not have a gun.”
After a similar plea from Sen. Barbara Boxer, California Democrat, and a warning from Sen. John McCain, Arizona Republican, that the move could embolden Democrats’ push for filibuster reforms, Mr. Coburn eventually backed off.
“There’s more here, frankly, than just a refusal to allow an amendment,” Mr. McCain said. “That is going to mean that it’s more likely that we have this showdown, which we think — many of us think — would be devastating to this institution and the way that it’s done business for a couple of hundred years.”
The quarrel over the broader bill and the filibuster continued on the Senate floor Monday when Mr. McCain dinged Sen. Rand Paul, Kentucky Republican, when he alluded to Mr. Paul’s previous threats to filibuster the bill if there was not a vote on an amendment to ensure a trial to American citizens accused of terrorism. That provision was approved by the Senate last week.
The measure that sparked last week’s late-night imbroglio is also part of a still-pending sportsman’s bill that the Senate declined to vote on last week. Similar legislation has been proposed in past years, and a bill introduced by Sen. Richard Burr, North Carolina Republican, and Sen. Jim Webb, Virginia Democrat, passed the Senate Committee on Veterans Affairs unanimously in September.
The debate on the measure should not be about gun control, but about veterans’ mental health, said Tom Tarantino, senior legislative associate for Iraq and Afghanistan Veterans of America.
“If even one person will not go to seek the help they need and they fall through the cracks because we failed to remove the mental health stigma as much as possible, then we’ve failed,” he said. “Right now, what happened is someone pulled the thread of politics in something that should not political. And that thread’s starting to unravel.”
But Brian Malte with the Brady Campaign to Prevent Gun Violence said simply that if Mr. Coburn’s amendment passes, more than 100,000 people deemed medically incompetent would immediately be able to purchase guns. He also noted that the declaration is not absolute.
“There is due process,” Mr. Malte said. “Gun possession is allowed if competency is restored. It’s up to the professionals to make that determination.”
The 1993 Brady Bill established a five-day waiting period for handgun purchases, and the Bureau of Alcohol, Tobacco, Firearms and Explosives’ enforcement regulations declared that those deemed mentally defective could not purchase or possess a firearm.
The Department of Veterans Affairs forwards the names of those labeled mentally incompetent to the FBI for inclusion in a national federal database, barring them from purchasing or carrying firearms. Story Continued:
· IRS aims to clarify investment income tax under healthcare law – The Internal Revenue Service has released new rules for investment income taxes on capital gains and dividends earned by high-income individuals that passed Congress as part of the 2010 healthcare reform law.
The 3.8 percent surtax on investment income, meant to help pay for healthcare, goes into effect in 2013. It is the first surtax to be applied to capital gains and dividend income.
The tax affects only individuals with more than $200,000 in modified adjusted gross income (MAGI), and married couples filing jointly with more than $250,000 of MAGI.
The tax applies to a broad range of investment securities ranging from stocks and bonds to commodity securities and specialized derivatives.
The 159 pages of rules spell out when the tax applies to trusts and annuities, as well as to individual securities traders.
Released late on Friday, the new regulations include a 0.9 percent healthcare tax on wages for high-income individuals.
Both sets of rules will be published on Wednesday in the Federal Register.
The proposed rules are effective starting January 1. Before making the rules final, the IRS will take public comments and hold hearings in April.
Together, the two taxes are estimated to raise $317.7 billion over 10 years, according to a Joint Committee on Taxation analysis released in June.
To illustrate when the tax applies, the IRS offered an example of a taxpayer filing as a single individual who makes $180,000 in wage income plus $90,000 from investment income. The individual’s modified adjusted gross income is $270,000.
The 3.8 percent tax applies to the $70,000, and the individual would pay $2,660 in surtaxes, the IRS said.
The IRS plans to release a new form for taxpayers to fill out for this tax when filing 2013 returns.
The new rules leave some questions unanswered, tax experts said. It was unclear how rental income will be treated under the new rules, said Michael Grace, managing director at Milbank, Tweed, Hadley & McCloy LLP law firm in Washington.
“The proposed regulations surely will increase tax compliance burdens for individuals,” said Grace, a former IRS official. “There’s clearly some drafting left to be done.” Story Continued: