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Dispatch for: October 11, 2021
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Dispatch for: October 11, 2021

Pandora Papers and Fishing Reels and blatant self promotion.

Andrew Leahey 🦣
Oct 11, 2021
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Dispatch for: October 11, 2021
www.taxmailinglist.com

In this weeks dispatch I have the first of my blatant self promotions: the Bloomberg Tax article on the Pandora Papers and South Dakota was authored by none other than yours truly. You may lodge your complaints at the desk.

DECISIONS/LETTER RULINGS

Seller of Fishing Reels Isn’t Liable for Excise Tax.

NEWS OF NOTE

Nigerian national charged with money laundering for investment fraud conspiracies. (IRS Press Release):

According to the indictment, Edeh managed used car dealerships and currency transfer services in Texas, Florida and Nigeria. This included a trading company as well as a cryptocurrency and e-commerce firm, both of which were based in Nigeria, through which Edeh exchanged Bitcoin and other cryptocurrencies for profit.

…

Specifically, the schemes purported to offer trading and Bitcoin investing services when, in fact, investor funds were allegedly stolen and later victims' investments were used to pay purported returns to earlier investors.

Key findings from the Pandora Papers investigation. (Washington Post)

Financial Advisers Pitch Bitcoin to Investors to Offset Portfolio Losses. (Wall Street Journal)

Why Some Advisors Are Pitching Bitcoin as a Way to Offset Losses. (NASDAQ)

Pandora’s Box in South Dakota—Privacy Is Not the Enemy. (Bloomberg Tax)

US Department of Justice creates cryptocurrency enforcement unit. (The Verge)

World leaders reach landmark deal on a global corporate tax rate. (CNBC)  - Global minimum corporate tax rate of 15% for companies with a revenue above ~$865m USD.

OP-ED/INTERESTS

Pandora Papers: The release is going to be something of a slow-motion reveal in terms of its implications. The banner story remains the South Dakota trust revelations, but I imagine there will be more to unpack over time. The narrative around the use of trusts to reduce tax burdens raises interesting ethical questions as well as policy concerns. How can we structure trust law to enable “legitimate” uses for “legitimate” purposes but avoid outcomes like what we have in South Dakota, with decades of trust-law-creep coalescing in to a scandal? Efforts to adjust tax rates to reallocate resources and put the bills on the desks of the individuals and corporations that are most able to pay them will be blunted by the kinds of policies we see in South Dakota. Changes will need to be made.

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Dispatch for: October 11, 2021
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