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EU GOES GLOBAL AS PATTEN CHASES SUPERPOWER ROLE
The European Union is to boost its role as global policeman under plans proposed in Brussels yesterday, using its power as the world's biggest aid donor to shape the international scene.
Chris Patten, the European external affairs commissioner, said the EU must develop a "tool kit" to nip conflicts in the bud and to raise its profile around the world. "We should try to ensure that our political influence comes nearer to matching our economic weight," he said. It now plans an "early-warning system" for potential trouble spots, a campaign of anti-drug actions, tough controls on the arms trade, and measures to stop the proliferation of nuclear, chemical and biological weapons.
The initiative is unrelated to plans already being developed by the European Commission for a Rapid Reaction Force, which would be under the control of EU ambassadors meeting in a separate set of buildings in Brussels. The EU also has access to up to 5,000 police to help to restore order in volatile regions such as the Balkans. Mr Patten's remit is limited to the EU's £7 billion annual aid budget, which he is using to spearhead an activist foreign policy.
When the national aid programmes of the 15 member states are included, the EU provides 55 per cent of the world's development aid and 66 per cent of outright grants. Mr Patten yesterday dismissed suggestions that Brussels was attempting to dominate global affairs, challenging America on a broad range of issues far beyond Europe's borders. "We're not seeking a hegemonistic role," he said.
Washington is uneasy over the EU's decision to send a mission to North Korea next month to promote the Communist nation's dialogue with South Korea. The Bush administration, which still deploys large numbers of troops on the Korean border, is treating the dictatorship in the North as a dangerous, nuclear-armed pariah.More on this story here.
IRS IN LOSING BATTLE AGAINST INTERNET TAX FRAUDSTERS
Late last week, the IRS Oversight Board, a Congressional body which supervises the US tax collection agency, said inadequate financing was preventing the IRS from going after delinquent tax-payers - and by coincidence, on the same day Senator Chuck Grassley (Rep. Iowa), head of the Senate’s tax-writing committee, warned Americans to steer clear of hundreds of web sites promoting illegal online tax-evasion. The tax scammers, who operate year-round, use lines such as “The IRS is weak - play the audit lottery” and “It’s your ‘right’ not to pay taxes” to attract unsuspecting taxpayers, according to the committee.
It’s not really a coincidence, because Americans are nearing their annual deadline for filing tax returns.
“Tax scams are as old as the tax code,” said Mr Grassley. “The internet is giving them new life.”
At a recent hearing, the committee learned that hundreds of thousands of Americans are involved knowingly or otherwise in internet-based tax scams.
Mr Grassley has a checklist taxpayers can use to avoid doubtful schemes. For instance, he says, watch out for these favourite pitch lines: “If this were illegal, don’t you think the government would arrest me? It hasn’t.” “Taxes are ‘voluntary’. Smart people will not volunteer to pay.” “Taxes are unconstitutional. The 16th Amendment was never ratified.” “Rich people save money on their taxes with this plan; so can you.” “Disguise your income on tax forms. You can’t be caught by IRS computers.”
The committee recommends that any proposed tax-saving scheme should be checked out by an accountant or tax attorney. The IRS also has a list of warning signs: a promise to reduce or eliminate income and self-employment tax; deductions for personal expenses paid by the trust; depreciation deductions on an owner's personal residence and furnishings; high fees for trust packages, to be offset by promised tax benefits; use of back-dated documents; lack of an independent trustee; and use of post office boxes for trust addresses.More on this story here.
SOFTWARE BOOTS ONLINE ADS OFF PC’S
As online advertisers get more aggressive, so do efforts to block them.
Ad-blocking software, which makes online advertisements disappear from consumers' screens, has been available for several years. But it's just now becoming both powerful and easy to use, analysts say.
Webwasher.com, a spin-off of German electronics giant Siemens, already has more than 4 million worldwide users. Last week, it finished staffing a New York office as it seeks to boost its presence among U.S. consumers.
Webwasher is "the most dangerous piece of software in the world" for the publishing industry, contends Jason McCabe Calacanis, editor of the Silicon Alley Daily. "When the music industry had to deal with Napster, I never realized how conflicted technology can make an executive's life .... I love Webwasher .... but as a publisher, I know it is a very dangerous proposition."
Software maker InterMute, which has an ad-blocking software program named AdSubtract, last year signed a deal with Zoom Telephonics, which makes Zoom and Hayes modems, to include AdSubtract with modems.
New companies continue to get into the game. New Jersey start-up, Guidescope, is currently testing software similar to Webwasher.
Madison Avenue insists that the ad-blocking programs are not a threat. "They're not going to be that prevalent," says Gerard Broussard, a director for advertising firm Ogilvy & Mather. He says most users won't bother to install the software.
"There have been various attempts to get rid of advertising forever, like TV remote controls. It's never meant the end of advertising," agrees Catharine Taylor, the interactive editor of Advertising Age.
Others aren't so sure. Somewhat savvy PC users can install the programs in less than 15 minutes. The software filters ads from reaching consumers' screens similar to the way anti-virus software filters viruses.
Calacanis, for one, predicts that ad-blocking software which is free to home users will become commonplace in the next year, even if it doesn't come pre-installed on tech gadgets. In Europe, Webwasher.com has 1,000 corporate customers who install it on central servers connected to workers' PCs.
The software also comes with another benefit: Because it blocks ads, it makes Web pages load faster. "It does a lot for my speed," says AdSubtract user Tim Kelly from Acton, Mass.
Demand for the software, analysts say, will grow as online sites put up more ads. In recent months, popular sites such as CNET and Salon have begun featuring larger ads as a response to falling advertising rates.
The Interactive Advertising Bureau, a trade group, also began advocating larger ads in February. “Banner ads are not a technology that is going to survive,” says Horst Joepen, CEO of Webwasher.com, which sells Webwasher.More on this story here.
MICROSOFT SECURITY SOFTWARE HAS SECURITY GLITCH
Microsoft's first major foray into the Internet security software business, a network security product called Internet Security and Acceleration, was released with a bug that could prompt a so-called "denial of service" attack.
The Redmond, Wash.-based software giant offered a fix to the product on its Web site Monday, about two weeks after the Toronto Internet security consulting company FSC Internet alerted it to the problem.
The first version of Internet Security and Acceleration, or ISA, was released Feb. 14 as a firewall and proxy service designed to protect business computer networks.
FSC Internet chief executive Richard Reiner's investigation found that if one of the product's features, called Web publisher, was running, an outside user could send a series of commands to the server that would prevent people from accessing the network's Web sites. It also would prevent those inside the network from surfing the Web.
Even without the Web publishing feature running, someone inside the network could have sent the string of commands to prompt a denial of service.
The flaw would not have allowed a hacker to access the network to get information, Microsoft security program manager Scott Culp said.
Reiner said he was concerned that he discovered the problem relatively easily, after about 15 minutes of routine testing.
"In what is essentially a firewall product, it's very unusual to see a flaw like this," Reiner said.
Culp said the product had been well-scrutinized and extensively tested, and that it is being used on Microsoft's own Web sites.
"We know that software always has bugs and that some of those bugs will always affect security," Culp said. "The fact that someone happened onto this bug doesn't say anything about the quality of the code."More on this story here.
IRS PREDICTS INCREASE IN AUDITS
An infusion of money and improved technology will begin to reverse the decline in Internal Revenue Service audits, which agency chief Charles Rossotti says are essential to ensure compliance. But he has a warning for those tempted to cheat.
"This is really not a good path for the average taxpayer," Rossotti said Wednesday in an interview with The Associated Press. "If you want to make bets, your odds would be better to go to a casino."
Less than a week before Monday's tax filing deadline, Rossotti said that, like millions of other taxpayers, he is asking for the automatic four-month extension to finish his return and that his taxes are done by an accountant.
Unlike most people, Rossotti gets audited every year.
"That's one of the privileges of being commissioner," he said with a grin. "I really do want to file an accurate tax return."
Last year, the percentage of audited returns fell to below one-half of 1 percent, which Rossotti blamed on tight budgets over the past five years and lack of money to replace antiquated Internal Revenue Service computers.
President Bush is asking Congress for a $580 million increase for the IRS for fiscal 2002, mainly for technology and to continue hiring about 4,000 in additional staff, in part to beef up enforcement.
"Continuing to drop, year after year, would not be a sound thing," Rossotti said. "We have to have a certain amount of compliance activity."
But audits, the IRS chief added, represent only one of many ways the IRS checks returns for cheaters. Computers match taxpayer documents with those provided by banks, employers and other sources for accuracy. Even neighbors can be a source for the agency.
"You'd be surprised how many people tell us about other people who don't fill out accurate returns," he said.More on this story here.
EU COMMISSION LAUNCHES PLAN TO IMPROVE TAXATION OF CROSS-BORDER PENSIONS
Following a commitment made at the Stockholm European Council in March, the EU Commission yesterday issued details of its plans to improve the European tax regime for cross-border provision of pensions. The proposals form part of the EU's new strategy to open up pan-European labour markets by 2005, adopted on 28 February. The new tax initiative complements the Commission's October 2000 proposal for a directive on occupational retirement provision that would facilitate cross-border pension provision and investment.
"This initiative presents comprehensive solutions to deal with the many existing tax obstacles to the cross-border provision of occupational pensions," said EU Tax Commissioner Frits Bolkestein. He added: "A fully functioning internal market for occupational pensions is essential to ensure that citizens are able to exercise their rights to free movement which are enshrined in the EC Treaty and thus to enhance labour mobility."
Currently there are major obstacles that deter employees from contributing to occupational pension schemes outside their home country, and also make it difficult for pension institutions to provide cross-border pensions in the European Union. The Commission is pledging to monitor member states' national rules on pension provision and "take the necessary steps" to ensure their compliance with EC Treaty rules on the free movement of capital, labour and services - in particular regarding rules on non-discrimination. Where necessary, the Commission warns it will take legal action against EU countries for non-compliance.
In addition, the Communication sets out measures to safeguard member states' tax revenues in cases of cross-border pension provision. The Commission also suggests a co-ordinated approach to eliminate the tax obstacles, particularly so-called "double taxation", which arise from the mismatch of countries different pensions' tax systems.
The full text of the Commission's proposals is available here.More on this story here.
EUROPE VIEWS THE BUSH ADMINISTRATION
"Aggressively conservative and free-market, pro-business and anti-regulatory at home, assertively unilateralist abroad, it makes no secret of its unyielding faith in the American way, and seems to brook no compromise with alternatives."More on this story here.
Rumor says The Bahamas, Panama, Liechtenstein and the Cayman Islands may be removed from the Financial Action Task Force blacklist, come June, since each nation has toughened its anti-money laundering laws.More on this story here.
RUSSIA’S OWN BLACKLIST
MOSCOW. Blacklisted by FATF, the Russian government has drawn up its own blacklist of nations it accuses of harboring its stolen cash.More on this story here.
CYPRUS SURRENDER CONFIRMED
Ending its claim to tax haven status, Cyprus confirms it has sold out to OECD demands for higher taxes and an end to financial privacy.More on this story here.
GREEK POLICE STATE?
ATHENS. “Fighting terrorists”, Greece abolishes jury trials, mandates DNA testing, and imposes surveillance on citizens.More on this story here.
JERSEY JERKED BY LONDON
Here's a good example of how the Channel Islands are being controlled by Tony Blair's Labour government, constitutional law be damned.More on this story here.
VANUATU'S NEW GOVERNMENT
After a no confidence vote, a law suit and a court ruling, this Pacific island haven has a new government that pledges to clean up alleged money laundering.More on this story here, here, and here.
And the COOK ISLANDS prime minister again knocks the OECD.More on this story here.
£6 BILLION SHIP OF DREAMS
GLASGOW, Scotland. Developers of a giant floating tax haven that would be the world's biggest ship say construction starts soon.More on this story here.
DUAL PASSPORTS CAN SAVE YOUR LIFE
Chris KALIN, explains how a second passport can save your life and tells you if you qualify.More on this story here.
And they can help avoid border crossings from Hell, like these,More on this story here.
AN ALL AMERICAN FREE TRADE ZONE?
What would a US$13 trillion combined GDP mean?More on this story here and here.
OFFSHORE FUNDS BOOMING
During the first quarter offshore investment funds led world gains.More on this story here.
GOLD SALES BOOM
Investors sold gold hand over fist last year, particularly in Europe, where gold is viewed as an insurance policy.More on this story here.
LONDON. British euro backers fear a national referendum will overwhelmingly vote to keep the pound sterling.More on this story here.
PRAGUE. Czech Republic banks are bracing for a wave of money laundering when the euro becomes official. Czech ML laws are lax.More on this story here.
MADRID. The EU launch of euro notes and coins next January forces Spaniards to dispose of all those pesetas stuffed in mattresses.More on this story here.
I.R.S. TAX RAIDS CONTINUE
Kansas tax advisors are hit with a massive raid, $9 million forfeiture.More on this story here.
MONEY LAUNDERING LAW GAP
US bank affiliated securities firms escape reporting suspicious transactions that might involve money laundering.More on this story here.
LEGAL FEES PAID WITH OFFSHORE STASH?
The US government alleges a convicted fraudster paid his legal fee with a half million dollars in secret offshore funds.More on this story here.
BIOMETRIC PASSPORTS PLANNED
The Dutch start trials in June. The US may convert by 2008. We mean credit card size 'biometric passports' that will ID you while a camera reads the unique iris of your eye.More on this story here.
BUSH MAY O.K. CARNIVORE
Privacy be damned! US law enforcement officials push for use and expansion of the FBI's mass e-mail tapping "Carnivore" program.More on this story here.
U.S. POLICE USE SECRET EVIDENCE
The US Supreme Court allows police to use secret evidence to obtain arrest warrants and wiretap phones and computers.More on this story here.
BIG BROTHER STILL WEB WATCHING
US government Web sites continue to track browsing habits of Internet users despite rules that ban such activity.More on this story here.
This weekend could be pivotal in the battle against the OECD's phony "harmful tax competition" drive. G-7 finance ministers meet in Washington and our sources say the OECD want to convince the Bush White House to endorse communiqué language favoring the OECD's plans.More on this story here.
U.S. House Majority Leader, Rep. Dick ARMEY yesterday again urged administration officials to withdraw from the OECD campaign. Armey asked Bush's chief economic advisor Larry LINDSEY and Asst. Treas. Sec. for Tax Policy Mark WEINBERGER to act. Rep. Armey's statement at,More on this story here.
O.E.C.D LAID BARE
In one of the best commentaries on the OECD's world tax plans we have seen, Paul Craig Roberts lays it on the line. A must read!More on this story here.
Columnist Deroy Murdock calls it the “Attack of the global tax police”qMore on this story here.
The Washington Times opposes, “Taxation without representation.”More on this story here.
NOW BUSH KNOWS!
During the Summit of the Americas in Quebec leaders of 14 Caribbean states met with President George W Bush, in an attempt to persuade him to call an end to the OECD harmful tax competition campaign.More on this story here.
SOUTH AFRICA IN CRISIS
JOHANNESBURG. A highly dangerous deterioration is occurring here and the Mail & Guardian lays it all out. Is Thabo Mbeki fit to rule?More on this story here.
BAHAMAS GOES ALONG
NASSAU. The government signs on to a UN treaty that obligates mutual legal assistance with all other signatory nations, and another treaty that makes extradition easier.More on this story here.
And speaking of extradition, RUSSIA keeps chasing Putin critic and ex-press baron Vladimir Gusinsky. SPAIN and ISRAEL have refused to send him back to face political charges.More on this story here and here.
MALTA WANTS YOUR BUSINESS
VALETTA. New tax incentives for foreign business make this island nation a really attractive investment.More on this story here.
THE ULTIMATE AMERICAN TAX HAVEN?
What if the Nation's Capital imposed no income taxes?More on this story here.
REPORT ON MONEY LAUNDERING
The Economist reports on the state of anti-money laundering and banking. Banks are doing more than ever before to clamp down.More on this story here.
And the Economist's "Big Mac" annual cost of living index of national currencies offers comparative food for thought.More on this story here.
BERMUDA STILL CAPTIVE CAPITAL
HAMILTON. Bermuda now holds 31.5% of the world's total captive insurance market of 4,458 captives, with 1,405.More on this story here.
Scottish Annuity & Life Holdings Ltd. abandons the Cayman Islands and moves to Bermuda. It was the CI’s largest reinsurer.More on this story here.
EURO CAUSES FRANC PROBLEMS
ABIDJAN, Cote d'Ivoire. Introduction of the euro will disrupt use of the French franc in the African Franc Zone.More on this story here.
LEMIEUX ON FREE TRADE
Pierre Lemieux, professor of economics at the U. of Quebec, in a Wall Street Journal op-ed piece says "Free Trade Doesn't Require Treaties."More on this story here.
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