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THE SOVEREIGN SOCIETY OFFSHORE A-LETTER
Your Link to Freedom, Prosperity & Privacy in the Offshore World
Wednesday, April 18, 2001 - Vol. 3  No. 31
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In This Issue:
* COMMENT: Anti-Tax Haven Sanctions - All Out War?

* OFFSHORE: Tax Scare Time. OECD Ignorance. Liechtenstein Example.
Mid-East Banking. Italian Elections. Irish View of 'Squalid' Caymans.
British Virgins. Open for Offshore Business in Nevis or Uruguay.

* WEALTH: US IRS - Feeble or Fierce? Bermuda Tax Avoidance Bonanza.
Crime & Taxes Down Under. World Consumers Confident. Euro Pickets.
American Free Trade Zone? Billions Net Scam. Keep the Change!

* PRIVACY: New Computer Privacy Report.
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* COMMENT *

Anti-Tax Haven Sanctions - What Happens If There Is All Out War?
by Bob Bauman, Editor

We're getting weary of writing about the OECD and FATF blacklists
and those "sanctions" that supposedly will be clamped on world tax
havens, come June 30. That was the Paris bureaucrats' self-inflicted
deadline chosen a year back when they believed CLINTON-GORE (remember
them?) leftist Treasury minions would be in control in Washington, DC.

Last June these nervy public relations megaphones for the rich G-7
nations issued arbitrary lists of small nations they accused of being
lax on criminal money laundering and/or engaged in nefarious "harmful
tax competition."

Then, and repeatedly since, the Blacklisted Ones have been threatened
with nebulous "sanctions," possibly including severance from world
banking and financial systems. As co-conspirators, the Clinton crowd
at the US Treasury tried and failed to get congressional approval for
this obtuse thuggery. Now a new president named Bush is more or less
in control, and still we wait for what should be an easy & resounding
official "NO" to the OECD high tax cartel. Absent the US, there's
little chance the OECD can impose any meaningful "sanctions," however
much the bureaucrat bullies bluster.

But what might sanctions look like? How disruptive could they be,
if they were indeed imposed on the 35 blacklisted offshore nations.

Sovereign Society advisory board member J. Richard DUKE
(http://www.assetlaw.com) calls attention to a 2 part article in the
April and May issues of the Journal of International Taxation,
(available only to subscribers on line). There New York attorney
David E. Spencer provides a glimpse of the chaos that could result
in world financial markets if the OECD has its perverse way by
imposing sanctions on "uncooperative" tax haven nations.

Among the OECD suggested sanctions nations might impose;
* use of domestic tax laws to deny all deductions, exemptions,
allowances and credits for taxpayers or entities doing business in
haven nations;
* under civil and criminal penalties, require new, extensive reporting
of all offshore financial activity;
* expansion and strict enforcement of controlled foreign corporation
(CFC) rules;
* levy new withholding taxes on payments or transfers to havens;
* increased tax audits of all offshore business activity;
* review, repeal and/or refusal of bilateral tax treaties;
* special new tariffs on financial activity involving haven nations.

In the case of the US and most other nations, all of these radical
proposals would require legislative action that is highly unlikely to
occur. But imagine what this would do to the international financial
world as we now know it. June 30, here we come!

LINKS: http://www.tax-news.com/asp/story/story.asp?storyname=3127
http://www.tax-news.com/asp/story/story.asp?storyname=2694
http://www.treas.gov/press/releases/po40.htm
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*  OFFSHORE *

OFFSHORE TAX SCARE TIME
The Los Angeles Times just noticed that the IRS is cracking down
on the use of offshore bank accounts to evade income taxes.
LINK: http://www.latimes.com/business/20010415/t000031914.html

If you have a dirty secret about an offshore trust, FORBES says it
may not be too late to fess up and avoid prison. Very interesting!
LINK (free reg req): http://www.forbes.com/forbes/2001/0430/136.html

And Forbes claims the IRS still does not have those Caribbean bank
credit card records[s] ordered by a Miami US Court to be turned over.
LINK: http://www.forbes.com/forbes/2001/0430/136s01.html

And watch out for Internet tax fraud schemes. They're everywhere!
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=3138
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O.E.C.D. ILLOGIC EXPOSED
JERSEY's Edmund BENDELOW, head of the Offshore Institute, rips
the hide off the OECD's economic ignorance. LINK( free reg req):
http://www.mondaq.com/article.asp?articleid=10876&product_id=2&company_id=2947
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LIECHTENSTEIN'S EXAMPLE
VADUZ. The Economics minister explains why the principality provides
an example of outstanding free market economic freedom. LINK:
http://www.freedomandprosperity.org/Papers/Buchel-11-00/buchel-11-00.shtml
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FINANCIAL TIMES SPECIAL REPORTS
ON MID-EAST BANKING: account surpluses in Gulf countries are at
a phenomenal US$68 billion, compared with a deficit two years ago.
LINK: http://surveys.ft.com/mebfi2201/index.html

ON THE ITALIAN ELECTIONS: On May 13 will the Right win? LINK:
http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3PJQKQMKC&live=
true
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IRISH TIMES LOOKS AT CAYMANS
An Ansbacher opinion report: "Liberal tax laws transformed a group of
squalid islands off Mexico into a wealthy [Irish]man's tax haven." LINK:
http://globalarchive.ft.com/globalarchive/article.html?id=010412004910
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B.V.I. CHIEF MINISTER MEETS U.S. GROUP
ROAD TOWN, British Virgin Islands. The CM thinks the new Bush
folks in Washington will not back the OECD anti-haven campaign.
LINK: http://www.islandsun.com/2001-April/130401/local4-v4i54.html
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NEVIS FINANCIAL SERVICES
BASSETERRE. One of the last of the unrepentant offshore tax havens
beckons to you. All the considerable facts at LINK (free reg req):
http://www.mondaq.com/article.asp?articleid=10862&product_id=2&company_id=983
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URUGUAY WANTS YOUR BUSINESS
MONTEVIDEO. Not on any blacklist and no taxes, wide open for offshore
business and welcomes high net worth expatriates. LINK:
http://www.mondaq.com/article.asp?articleid=10746&product_id=2&company_id=4350
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EXPATRIATE  OFFSHORE HEALTH INSURANCE
Sovereign Society advisor Chris KALIN of Henley & Partner recommends
an established health care insurance provider for portable expat
insurance.
LINK: http://www.newsweekclassified.com/health/advertisers/ihi/ihi.htm
Henley & Partner: http://www.henley-partner.com/
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* WEALTH *

US INTERNAL REVENUE - FEEBLE OR FIERCE?
As US annual tax day passes, the IRS is said to be a weak sister
forgiving (thank you!) $2.5 billion in back taxes,
LINK: http://www.nytimes.com/2001/04/13/business/13IRS.html

And also ready to put the audit screws to many more ordinary Americans.
LINK: http://www.foxnews.com/story/0,2933,6557,00.html

On average, Americans must work until May 3 this year to pay their
taxes. After that, what's left is theirs.
LINK: http://dailynews.yahoo.com/h/nm/20010413/ts/life_taxes_dc_1.html
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BERMUDA TAX AVOIDANCE BONANZA
HAMILTON. How the super rich use Bermuda as a base for the
great hedge fund reinsurance tax game. LINK:
http://www.iimagazine.com/channel/insurance/20010412000967.htm
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CRIME & TAXES DOWN UNDER
SYDNEY. Australians are said to have had a love affair with crime
ever since British convicts kicked off a white settlement 213 years
ago with a no-holds-barred orgy.
LINK: http://uk.news.yahoo.com/010416/80/bl12q.html

But Australia is cracking down on "tax avoidance schemes."
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=3119

JOHANNESBURG. The South African government seems determined to do
all it can to discourage badly needed foreign investment.
LINK: http://allafrica.com/stories/200104100140.html
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NO GLOOM ON MAIN OR HIGH STREET
World consumers are cheerfully ignoring the gloom on world stock
markets. LINK:
http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3OQRD2LLC&liv
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U.K. LIBERTARIANS PROTEST EURO
Libertarians picket businesspersons who favor the euro. LINK:
http://www.telegraph.co.uk:80/et?ac=000140326706927&rtmo=QwOwOQ0R&atmo=QwOwOQ0
R&pg=/et/01/4/16/ncand16.html
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FREE TRADE FOR THE AMERICAS?
April 20-22, heads of 33 governments meet in QUEBEC for the Summit
of the Americas. Is an American free trade area now possible? LINK:
http://www.economist.com/agenda/displayStory.cfm?Story_ID=568612
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BILLIONS LOST IN NET SCAM
LONDON. Investigators shut down a banking scam that used the Internet
to sell fake securities and investments estimated at $3.9 billion. LINK:
http://www.idg.net/crd_idgsearch_2.html?url=http://www.computerworld.com/cwi/s
tory/0,1199,NAV47_STO59548,00.html.html
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KEEP THE CHANGE!
NEW YORK. Calling unneeded attention to himself, a London stock
broker leaves a US$16,000 after dinner tip.
LINK: http://www.newyorkpost.com/news/regionalnews/041001a.htm

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* PRIVACY *

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THE SOVEREIGN SOCIETY OFFSHORE A-LETTER
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