Conspiracy? No, I'm from the 60's.

My son must approve my blogs, ain’t that special……He thinks I am too conspiracy oriented, too radical…..And I tell him it is the 60’s…..I am a product of the 60’s.

Under the 2010 HIRE ACT the United States Treasury Dept. was granted the authority to collect withholding taxes from foreign financial institutions.  Under a new Chapter 4 foreign financial institutions with US account holders may be subject to a 30% withholding tax on income from US financial institutions unless they agree to disclose the 1. Identify of any US person, 2. Account number, 3. Account balance or value, and 4. Gross receipts and gross withdrawals.  Another Code Section imposes new reporting requirements on individuals who hold more than $50,000 in any financial account.   And lastly, the statute of limitations is suspended.

So the United States of America is tightening the noose…..They are laying the foundation to prevent or reduce capital flight…..Capital flight….Something countries like Argentina have dealt with forever…..When economies face huge debt loads which must result in increased tax rates, and citizens want to move their money, powers that be work to prevent that.  Capital flight exacerbates economic trouble.  So how does a Govt. prevent its citizens from moving their money to another country?  First they have to find it…..Then they have to tax it…..Not easy to do in a hurry, so they are paving the road now…..

We will not go gently.

-Michael