My friends at Global Financial Integrity have reported that:

The introduction today of The Stop Tax Haven Abuse Act, which would “restrict the use of offshore tax havens and abusive tax shelters to inappropriately avoid Federal taxation” by Senator Carl Levin (D-MI) represents a crucial step towards improving U.S. tax assessment and collection and strengthening the global financial system.

The “Stop Tax Haven Abuse Act” is similar to a previous bill, S. 681, introduced by Senator Levin in 2007 and cosponsored by then-Senator Barack Obama with 3 significant new additions.

Current cosponsors of the Senate bill include Senators Sheldon Whitehouse (D-RI), Claire McCaskill (D-MO), and Bill Nelson (D-FL).  The House version will be introduced by Representative Lloyd Doggett (D-TX) with multiple cosponsors.  The bill will be referred to the Committee on Finance in the Senate, and to Ways and Means Committee in the House.

As Raymond Baker of GFI says:

The provisions in this bill are designed to prevent the types of illegalities and financial obfuscations that lay at the heart of the on-going legal battle between US authorities and Swiss bank UBS and the Stanford Financial Group fraud case.

This is a systemic problem that goes beyond one or two financial jurisdictions or dishonest individuals. Last December the Government Accountability Office (GAO) released a report showing that 83 of the 100 largest, publicly-traded US companies and contractors have subsidiaries in tax havens.  Furthermore, four of those 83 companies are banks which received $127 billion in TARP bailout funds.  In the midst of historic economic crisis the US cannot afford to be complicit of  these illicit financial practices which cost the US billions of dollars every year.

Highlights of the 84-page bill are:

•Establish presumptions for entities and transactions in Offshore Secrecy Jurisdictions.

‚Ä¢Determine “Offshore Secrecy Jurisdictions.”

•Authorize special measures against foreign jurisdictions, financial institutions, and others that impede US tax enforcement.

•Treat foreign corporations managed and controlled in the United States as domestic corporations for income tax purposes;

•Allow more time for investigations involving Offshore Secrecy Jurisdictions;

•Increase disclosure of offshore accounts, transactions, and entities;

•Prevent misuse of foreign trusts for tax evasion;

•Limit legal opinion protection from penalties with respect to transactions involving Offshore Secrecy Jurisdictions;

•Close the offshore dividend tax loophole;

•Increase penalty for failing to disclose offshore holdings;

•Require anti-money laundering rule for hedge funds;

•Apply anti-money laundering obligations to company formation agents;

•Strengthen John Doe summons use in offshore tax cases;

•Strengthen foreign financial account reporting requirements;

•Strengthen tax shelter penalties;

•Deter financial institution participation in abusive tax shelter activities;

•Strengthen law enforcement through information sharing;

•Require tougher tax shelter opinion standards for tax practitioners.

This is one that has to make it to the statute book.

I believe it will.