Carl Levin on IRS Announcement on Offshore Tax Havens

October 14, 2009 -- WASHINGTON — U.S. Senator Carl Levin, D-Mich., issued the following statement today on the IRS announcement of preliminary results from its offshore bank account voluntary disclosure program. Levin is chairman of the U.S. Senate Permanent Subcommittee on Investigations, which has investigated tax haven abuse for the last decade.

“The fact that more than 7,500 U.S. taxpayers took advantage of the IRS voluntary disclosure program to disclose hidden foreign accounts at more than 100 banks in 70 countries suggests that our efforts to end tax haven abuses may be making progress. Some evidence of that progress is that many Americans are losing confidence in the ability of tax haven banks to hide their assets. But it is also clear that thousands of other taxpayers are still in the shadows, working to keep their offshore accounts hidden. That’s why Congress needs to enact legislation to crack down on offshore tax abuse and collect the estimated $100 billion in unpaid taxes being lost each year.

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“The IRS and Justice Department are to be commended for their efforts to bring offshore tax cheats to justice. But we also need to keep our eye on the ball when evaluating the success of the IRS voluntary disclosure program and other offshore tax initiatives. We know, for example, that U.S. taxpayers stashed $18 billion in hidden assets at one Swiss bank alone; we need to measure the extent to which the voluntary disclosures and other civil and criminal cases capture that $18 billion as well as assets hidden at other offshore banks.

“The IRS revealed today that one person alone disclosed foreign accounts with more than $100 million in assets, but didn’t say whether that individual acted after being informed by their bank that their name was being given to the United States. If that is what happened, it doesn’t count as a voluntary disclosure in my book.

“The IRS and Justice Department should now work together to ensure that the voluntary disclosures are evaluated and acted on, that back taxes and penalties are paid, and that those who refused to voluntarily disclose their offshore accounts are vigorously pursued.”

Source: Senator Carl Levin