Essential reading: Tax haven clampdown yields cash but secrecy still thrives, and more
Welcome to the top tax and accounting headlines from Reuters and other sources.
* Tax haven clampdown yields cash but secrecy still thrives. Chris Vellacott and Sinead Cruise – Reuters. A global campaign to tax trillions of dollars hidden in offshore tax havens has made revolutionary progress, an official leading the drive said, rejecting suggestions that the super rich are running rings around Western authorities. Leaders of the G20 group of leading Western and developing nations launched the campaign three years ago, aiming to claw back billions in lost tax revenue at a time when many governments are trying to cut huge budget deficits. Link
* Senate passes middle-class tax cut bill in symbolic move. Richard Cowan and Kim Dixon – Reuters. President Barack Obama’s fellow Democrats in the Senate on Wednesday won passage of a bill to renew tax cuts for tens of millions of Americans, while letting some rates rise for the wealthiest, in a largely symbolic vote. The legislation, certain to be rejected by the Republican-controlled House of Representatives, lets Democrats claim in advance of the November 6 elections that they passed tax cuts for most Americans, only to be stymied by Republicans. Link
* Pricewaterhouse had brief window into Peregrine’s books. Sarah Lynch – Reuters. PricewaterhouseCoopers, one of the world’s largest accounting firms, reviewed the accounts of failed futures brokerage Peregrine Financial Group while the alleged fraud at the brokerage was occurring, a top regulator told lawmakers on Wednesday. Gary Gensler, chairman of the Commodity Futures Trading Commission, revealed that PwC was retained in 2000 after Peregrine settled an enforcement action from the CFTC. Link
* About 50 political groups win tax-exempt status-IRS. Patrick Temple-West – Reuters. A senior Internal Revenue Service official on Wednesday put a number for the first time on how many political groups, including some “Tea Party” organizations, have gained IRS tax-exempt status in recent years. Link
* Small business audits often find no more taxes due-IRS watchdog. Reuters. The U.S. Internal Revenue Service’s watchdog criticized the agency for doing a high number of small business, “S-corporation” audits without finding additional taxes owed. Link
* Who deserves a tax break? The New York Times editorial. In a rare show of old-fashioned democracy, Senate Republicans allowed Democrats a simple-majority vote on Wednesday to pass a bill extending tax cuts on income up to $250,000 a year. Republicans, knowing the measure would be killed in the House because it raises taxes on the rich, chose not to filibuster it in hopes of “exposing” a few vulnerable Democrats to a tough vote. There was nothing tough about it, however, and Democrats at least finally put the Senate on record in favor of a sensible tax plan. Link