by Mike Masnick
Fri, Dec 2nd 2016 4:47pm
by Mike Masnick
Mon, Nov 21st 2016 6:25am
from the slow-down,-skippy dept
All records of account/wallet/vault activity including transaction logs or other records identifying the date, amount, and type of transaction (purchase/sale/exchange), the post transaction balance, the names or other identifiers of counterparties to the transaction; requests or instructions to send or receive bitcoin; and, where counterparties transact through their own Coinbase accounts/wallets/vaults, all available information identifying the users of such accounts and their contact information.Uh, yeah, that's not very limited. It's not limited at all. The IRS literally wants everything. Why? Because, according to the IRS, it's investigating one single tax cheat. In a declaration, IRS agent David Utzke, talks about a single tax cheat, and says this gives him a basis for requesting all info.
After using a traditional abusive offshore arrangement for approximately 5 years, Taxpayer 1 became fatigued with the effort required to manage his offshore accounts, attorneys, and applicable regulations, and discovered virtual currency while conducting internet research on the topic. Taxpayer 1 began testing the use of virtual currency and eventually abandoned the use of his offshore structure. Taxpayer 1 was able to use virtual currency to repatriate his assets without governmental detection.Utzke also mentions two other taxpayers, which were companies, not individuals, but which used Coinbase. He notes that others are laundering money and thus likely to be using cryptocurrencies. That may be true, but it seems like a pretty big stretch to argue that means Coinbase should cough up all details on all transactions.
For example, Taxpayer 1 originally worked with a foreign promoter who set up a controlled foreign shell company which diverted his income to a foreign brokerage account, then to a foreign bank account, and lastly back to Taxpayer 1 through the use of an automated teller machine (ATM). Once Taxpayer 1 abandoned the use of his offshore structure in favor of using virtual currency, the steps described above were the same until his income reached his foreign bank account. Once there, instead of repatriating his income from an ATM in the form of cash, Taxpayer 1 diverted his income to a bank which works with a virtual currency exchanger to convert his income to virtual currency. Once converted to virtual currency, Taxpayer 1’s income was placed into a virtual currency account until Taxpayer 1 used it to purchase goods and services. Taxpayer 1 failed to report this income to the IRS.
In the IRS's memorandum of support, it insists that it's just trying to find all the tax cheats, so it should get to look at all the records.
Since 2009, the use of virtual currency has increased exponentially. Some users value the relatively high degree of anonymity associated with virtual currency transactions because only a transaction in virtual currency, such as buying goods or services, is public and not the identities of the parties to the transaction. Because of that, virtual currency transactions are subject to fewer third-party reporting requirements than transactions in conventional forms of payment. However, due to this anonymity and lack of third-party reporting, the IRS is concerned that U.S. taxpayers are underreporting taxable income from transactions in virtual currencies. Further, because the IRS considers virtual currencies to be property, United States taxpayers can realize a taxable gain from buying, selling, or trading in virtual currencies. There is a likelihood that United States taxpayers are failing to properly determine and report any taxable gain from such transactions.Coinbase posted a short blog post Friday evening expressing concern over this while exploring the issues:
.... The issuance of the summons is warranted here because (i) the summons relates to an ascertainable group or class of persons; (ii) there is a reasonable basis for believing these U.S. taxpayers failed to comply with internal revenue laws; and (iii) information sufficient to establish these U.S. taxpayers’ identities is not readily available to the IRS from other sources.
Our customers may be aware that the U.S. government filed a civil petition yesterday in federal court seeking disclosure of all Coinbase U.S. customers' records over a three year period. The government has not alleged any wrongdoing on the part of Coinbase and its petition is predicated on sweeping statements that taxpayers may use virtual currency to evade taxes.What happens here is going to be a big, big deal in the cryptocurrency world. The IRS had to know that this was going to get attention, and perhaps that's the intent. But this seems like a massive overreach.
Although Coinbase's general practice is to cooperate with properly targeted law enforcement inquiries, we are extremely concerned with the indiscriminate breadth of the government's request. Our customers’ privacy rights are important to us and our legal team is in the process of examining the government's petition. In its current form, we will oppose the government’s petition in court. We will continue to keep our customers informed on developments in this matter.
by Mike Masnick
Mon, Oct 3rd 2016 6:20am
from the that's-not-how-this-works dept
Separately, a lawyer for Mr. Trump, Marc E. Kasowitz, emailed a letter to The Times arguing that publication of the records is illegal because Mr. Trump has not authorized the disclosure of any of his tax returns. Mr. Kasowitz threatened "prompt initiation of appropriate legal action."Unlike most of the nine other times (at least) during this campaign that Trump has threatened to sue a media property for their reporting, this one may at least have some tiny marginal legal basis -- though it's certainly not a slam dunk. What is true is that publishing someone's tax return without authorization is a federal crime.
But, it's not that simple. The NY Times would have a pretty strong First Amendment defense that what they're doing here is very much in the public interest. After all, Trump himself has made his tax returns (and his supposed acumen as a business man) an issue in this campaign by refusing to release them, despite every other major party candidate for President releasing tax returns going back decades (and even Trump himself mocked Mitt Romney for taking too long to release his own tax returns in 2012). So there's no argument here that this isn't newsworthy. It clearly is, and that certainly helps the NY Times's case. To me it seems like it should be a clear First Amendment win for the Times -- and plenty of others agree.
Plus, there's the fact that if Trump actually did sue, he'd have to admit the returns are really his and are accurate.
On top of that, Trump himself is regularly talking about getting information out there that hasn't been disclosed through authorized means. Remember, he's "joked" about asking hackers to release Hillary Clinton's emails. And just a few days ago, he tweeted for people to go searching for a former Miss Universe's sex tape in order to discredit her comments about how Trump had treated her.
Who knows if Trump is seriously going to pursue legal action -- in the past he's happily admitted to filing SLAPP lawsuits designed to cost whoever he sues money, even if he knows there's no chance of succeeding -- but if he does, it could become a pretty important First Amendment case... from someone who has already made it clear that he has no respect at all for the First Amendment.
Fri, Apr 15th 2016 2:08pm
from the intuit-ive-thinking dept
Yay, it's tax season again! As our American readers will know, this is the wonderful time of year when we scramble to get all of our taxes and deductions paperwork in order, take them to some storefront that looks like a military recruitment center, push all of those papers in front of someone that looks like they just graduated from college, and scream, "You figure it out!" For our foreign readers, I should explain that we do this because our tax code is more complicated than the plot of Game of Thrones, our tax authorities are every bit as ruthless as that same series, and we've collectively allowed our citizens' payment of due obligations to become a for-profit industry. But seriously, though, come to America. It's great. I swear.
Several times in the past, some members of our government have attempted to lessen the burden we bear to pay our taxes. It never seems to work because the industry that makes money off of this tax system -- the tax preparation people and software makers -- lobbies to keep filing free taxes a pain in the ass, directly scaring the public into thinking the government will over-charge them, and then indirectly and unethically having sockpuppets do the same. It's in this way that you have a free-to-file federal tax program that roughly two-thirds of the public would be perfectly qualified to use, instead only being used by 3% of the population. 'Merica!
Well, Elizabeth Warren and seven co-sponsors would like to change that by simply eliminating the need for returns entirely for a significant number of people.
On Wednesday, the Democratic senator introduced a bill with seven cosponsors, including Democratic presidential candidate Bernie Sanders, seeking to make significant reforms to the Internal Revenue Service (IRS). Under the bill, Americans with simple tax obligations would have the option not to complete a tax return at all, but to instead receive a pre-prepared return from the IRS with their liability or refund already calculated for them. The IRS already gets most employer and bank information on taxpayers’ obligations — such as W2s and interest earned — so all it would have to do is calculate what they would owe for them.In other words, have the IRS, which will be evaluating these people's returns anyway, simply do all the math for most of the simple tax returns. We're not talking about returns that would legitimately make use of deductions; we're talking about very simple tax returns, which is what most people have filled out by tax preparers or tax software anyway. Now, this is usually where someone will make the obvious point: the government doesn't deserve to be entrusted with this math. And, hey, I take that point seriously. The government has certainly shown its capacity to lie and deceive. But so has the tax-prep industry. Intuit has been guilty of all kinds of underhanded attempts to keep people from being able to file for free. They are proven deceivers, too.
For others with more complex situations — those who want to itemize their deductions or with many dependents who have to provide more information — the bill would direct the IRS to develop a free, online preparation and filing service that would allow everyone to file directly with the government, rather than relying on third party filing services like TurboTax or H&R Block. And taxpayers would be able to download the tax information the IRS already has.
In addition to that, this bill is directly setting its sights on the cozy relationship the IRS has with the tax-prep industry, so anti-governmenters should really think about getting on board with this.
The bill would also prohibit the IRS from entering into agreements that would restrict its ability to provide such free, online services directly to taxpayers. The IRS has signed a number of binding agreements with the tax preparation industry over the years that blocks it from offering free services directly to taxpayers itself, saying that it will “not enter the tax preparation software and e-filing services marketplace” and “not compete” with private service providers. The IRS’ declarations that it won’t enter the tax preparation space fly in the face of what it’s been mandated to do. In 1998, Congress passed a bill requiring the Treasury Department to develop a “return-free” tax system by 2008 for those with simple obligations, computing what those people owe with information the IRS already has. Yet Warren’s office argues that the IRS has instead turned control of the process over to private tax preparation companies.When a government institution rebukes its public duties in favor of corporate wishes, there's a word for that. And it's that corporate control that will be pushing back on Warren's bill. The tax-prep industry, after all, has spent nearly $30 million in lobbying Congress since the late nineties. We're all about to get a very real lesson on the effect of corporate lobbying on a Congress that is ostensibly designed to serve the public need. I suspect the results will be as instructive as they are ugly.
Part of the solution to this is, of course, a simplified tax code. But it's somewhat strange to see some in favor massive tax reform, including simplifying the tax code, come out against simplifying filing tax returns or eliminating returns entirely.
Yet some anti-tax groups that say they want a simpler tax code have fought against these efforts. Grover Norquist, founder of Americans for Tax Reform, has testified and advocated against a return-free system. Republican presidential candidate Ted Cruz has consistently called to abolish the IRS, rather than get on board with plans to direct the agency to make things easier for taxpayers.Some of that sentiment is likely coming from a worry that a simplified filing system would lead many people to be less angered by the overall tax system, and thus less interested in more radical reform. And some is likely born of a deep-seeded mistrust of government in general and the IRS in particular. Which, again, I completely understand. But it would be wise for the listeners of those mouthpieces to truly understand what this legislation would accomplish, because it's largely built around eliminating returns for filers with returns so simple that charging to file them is downright silly.
by Glyn Moody
Wed, Feb 17th 2016 11:23pm
from the undermining-the-rule-of-law dept
The dangers of corporate sovereignty chapters in so-called "free trade" agreements are increasingly well-known. That's especially the case for Techdirt readers, since we've been warning about this parallel legal system, which puts corporations above national laws, for well over three years. Now that the general issues of these investor-state dispute settlement (ISDS) mechanisms are widely understood, people are starting to explore more specific problems. Here, for example, is a new report from the Transnational Institute (TNI) looking at how ISDS cases limit the ability of governments to collect and even set taxes in their own lands:
Analysis of data and documents on hundreds of ISDS cases filed so far reveals that foreign investors have already sued at least 24 countries from India to Romania over tax-related disputes -- including several cases where companies have used this system to successfully challenge -- and lower -- their tax bills.
There's a particular issue faced by developing nations:
Eager to attract foreign investment, many developing countries have offered huge tax breaks to multinational companies. Governments must be able to review and reconsider their tax laws and any tax incentives they may have granted to foreign investors in the past. Tax breaks cost developing countries as much as $138bn a year, and repealing these could release much needed funding for healthcare and other critical public services.
Corporate sovereignty means that national sovereignty suffers: governments that want to remove tax breaks run the risk of punitive ISDS cases being brought against them, so often daren't try. Many nations are fully aware of this risk, and try to mitigate it with "carve-outs":
Though some of these carve-out clauses are stronger and clearer than others, they have not prevented lawyers from filing tax-related ISDS cases, and they have not prevented arbitrators from agreeing to consider them. The language in these treaties is often convoluted and sometimes contradictory, with exceptions within exceptions -- giving lawyers a lot to argue about but making it difficult for policymakers to know what actions could risk a treaty claim.
This exposes one of the fundamental flaws of corporate sovereignty. No matter how much new treaties may claim to "solve" the problems of traditional ISDS through the use of carve-out clauses, or by tweaking some of its features, arbitrators always have the last say, and can override or just ignore whatever changes have been made.
That's why there is only one solution to the many problems of ISDS: to drop it altogether, and let national courts resolve disputes. If domestic courts aren't fair or reliable enough, investors should refuse to put money into the country until they are. That will give governments a powerful incentive to fix any weaknesses in their legal systems. Corporate sovereignty clauses actually remove that pressure to improve traditional court systems, since investors won't use them and local people don't have any choice. In other words, despite frequent claims that ISDS is simply about strengthening the rule of law in countries that sign up to it, in reality, it does the opposite.
by Mike Masnick
Fri, Feb 12th 2016 3:31pm
from the the-taxes-shall-continue dept
The reason it took the Senate so long to actually vote on this was because a bunch of brick-and-mortar retailers have been trying to sabotage it, by tying the approval of the permanent ban on access taxes to a totally unrelated bill that would force e-commerce providers to charge a sales tax. This is a fight that's been going on for years. Historically, mail order and e-commerce shops didn't have to pay sales tax unless they had a physical presence in a state. This made sense, as the taxes were supposed to be to support local services that those companies relied on. However, brick-and-mortar retailers have been claiming that this is some sort of evil "loophole" because it creates an excuse for why people like shopping online rather than in their stores. So they've been demanding that increasingly onerous tax regimes be placed on online retailers, and insisted that such a bill must be approved in conjunction with the permanent ITFA.
However, in the end, that strategy appears to have failed -- at least for now. The retailers could only get an agreement that Congress will take up the retail sales tax issue later this year, rather than tying the two directly together. Still, it will be worth watching what happens on that issue in the coming months. Expect a full court press of misleading stories about a horrible "loophole" in the coming months, as these stores look to increase the taxes on things you buy online.
by Mike Masnick
Wed, Sep 23rd 2015 8:29am
club for growth
from the slappity-slapp-slapp dept
Simply stated, your Attack Ad is not only completely disingenuous, but replete with outright lies, false, defamatory and destructive statements and downright fabrications which you fully know to be untrue, thereby exposing you and your so-called "club" to liability for damages and other tortious harm. For example, while your Attack Ad blatantly misrepresents to the public that Mr. Trump "supports higher taxes", nothing could be further from the truth. To be clear, Mr. Trump's tax plan, which is scheduled to be released later this week, supports a lowering of taxes.Actually, it's not even close to the definition of libel. It's almost certainly not libel at all.
Not surprisingly, a closer look at your Attack Ad reveals that your supposed "source" for this statement is -- according to the small print on your website -- nothing more than a single article published in the Advocate on February 15, 2000, which quoted Mr. Trump as supposedly saying he would "impose a one-time net worth tax of 14.25% on the superwealthy ... to pay off the national debt." That's it. While a reputable organization would have at least had the decency to disclose its source -- and the fact that the source article is more than 15 years old -- your pitiful little grup conveniently chose to leave that information out in a delierate attempt to mislead the public into believing that it is reflective of Mr. Trump's current position -- when unquestionably, it is not. Making matters worse, you then chose to appear on several talk shows, including MSNBC's Morning Joe, in which you furthered the erroneous notion that Mr. Trump "supports higher taxes" even though you have absolutely no factual support for that statement. In other words, you lied. Mr. Trump does not support higher taxes. This is the very definition of libel.
The letter concludes in usual bluster:
In the event, however, we do not promptly receive these assurances, please be advised that we will commence a multi-million dollar lawsuit against you personally and your organization for your false and defamatory statements and the damage you have intentionally caused in my client's interests as well as pursue all other remedies available to us at law or in equity.You'd think that someone running for president would know better than to totally flip his lid over some random attack ad. You'd think that his lawyer would (1) know that this is not defamation and that (2) threatening as such only gives the original ad much more attention. Trump, as a very public figure, would need to show that the information in the ad was not just false, but that Club for Growth knew it was false and deliberately posted such false information to harm Trump. That's not going to happen, not in the least because there's plenty of evidence to support the claims that Trump has advocated (recently) for higher taxes. The Federalist provides a list of some recent articles:
ABC (Aug. 6): Donald Trump Once Proposed the Biggest Tax Hike EverYeah, good luck with that "very definition of libel" thing.
Bloomberg (Aug. 26): Donald Trump says he wants to raise taxes on himself
CNN (Aug. 27): Donald Trump: Tax the rich more
New York Times (Aug. 31): Increase taxes? Talk by Donald Trump alarms G.O.P.
International Business Times (Sept. 8): Elizabeth Warren Praises Donald Trump Tax Plan
Club for Growth seemed to take the whole thing in stride, tweeting out the following reply:
by Tim Cushing
Tue, Jul 21st 2015 8:12am
from the uber-but-for-killing-your-small-town-speed-trap dept
Self-driving cars are on the way, and in their wake, they'll leave a variety of entities slightly less better off. Insurance companies may be the first to feel the pinch, as less-than-risk-averse drivers are replaced with Electric Grandmothers more than willing to maintain safe speed limits and the proper distance between vehicles. And as goes the car accident, so go other areas of the private sector: personal injury/DUI lawyers, hospitals, body shops, red light camera manufacturers, towing companies, etc.
But the public sector will take the hit as well. "Flow my tears," said the policeman.
Consider the following. This past year, the City of Los Angeles generated $161 million from parking violations. Red light violations have a fee of $490. Californians caught driving under the influence are fined up to $15,649 for a first-offense misdemeanor DUI conviction and up to $22,492 for an under-21 equivalent. Cities in California collect, on average, $40 million annually in towing fees that they divide with towing firms. Simply put, the hundreds of millions of dollars generated from poor driving-related behaviors provide significant funding for transportation infrastructure and maintenance, public schools, judicial salaries, domestic violence advocacy, conservation, and many other public services.Someone has to pay for the roads and other government activities, but it won't be drivers. So, as the Brookings Institution report points out, new revenue streams will have to be sought. The obvious suggestion is tax-per-mile billing, but that puts the government right in your vehicle -- an idea that's not going to gain in popularity any time soon.
Since California legalized driverless vehicles, Google has logged more than 1.7 million miles during the testing phase and been involved in 11 accidents, none of which were the fault of the driverless vehicle. Tesla, Mercedes, and others are not far behind. It turns out that automated vehicle technology—unlike humans—abides by the law. And that’s bad news for local government revenues. In other words, once driverless cars become mainstream, deep revenue sources acquired from driving-related violations such as speeding tickets and DUIs will decrease greatly.
While the loss of revenue will have an impact, the picture painted here is skewed. For many years, communities have treated police departments as revenue generators, rather than crime fighters. This has skewed incentives so badly that some small towns have become nothing more than profitable speed traps. That's one end of the issue: the pressure (or the willingness) to overpolice minor traffic violations to keep city governments (and the police departments themselves) funded.
But that's only part of it. The situation looks rather dire, especially if one doesn't examine what's not being said in these paragraphs. As Scott Shackford at Reason points out, the Brookings Institution report does some mighty fine cherry-picking for its list of potentially-affected government services. Without a doubt, a downturn in revenue will affect good government programs like public schools and domestic violence programs. But it will also cut back funding for far more dubious government spending.
What an interesting list of government-financed uses they've chosen. Notice they left off "Poorly made third-party database software that will stop working properly in less than three years and that was purchased from somebody belonging to the same frat as the assistant city manager," "police abuse settlements," and "blatant pension spiking."These "losses" will also be somewhat offset by less tax revenue being spent on traffic enforcement, accident response units and other related law enforcement activities. This will also mean fewer law enforcement officers will need to be employed, which should further reduce government expeditures.
The problem is that most governments aren't capable of heading off this sort of "threat" to their livelihoods, even with years of advance notice. Trimming back unneeded public sector employees won't happen until years after it's obvious they're no longer needed and will often come accompanied with expensive severance packages. New tax revenue streams won't be explored until they can be put off no longer, and often will just be added on top of existing taxes, rather than replacing those that have slowed to a trickle.
Worse, those most affected by this sort of shift will be the same people most affected by most government tax increases: the poor. The lowest income brackets will be the last to adopt driverless vehicles, leaving them the most exposed to fines for traffic violations (fines that will likely increase as revenue dwindles), as well as new costs like per-mile taxation. They're also most likely to see support programs they rely on suffer cuts as traffic enforcement money dries up.
The report somewhat addresses this outcome with a discussion of income inequality and the "disappearance of the middle class." While some of it is accurate and some of it is mostly buzzwords in search of a point, there's no doubt that traffic enforcement revenue will mostly be collected from those who can least afford it. After all, governments have done this for years -- something that helped fuel the outrage and backlash in Ferguson after the shooting of Michael Brown.
Is Brookings actually trying to blame the gap between billionaires and the poor for the racial tension in Ferguson? Which venture capitalist was it who told the Ferguson police to step up fine collection to rake in more money for the city's coffers? Which hedge fund manager invented the bureaucratic court system in Ferguson and other St. Louis County cities designed to wring every last cent from any indigent minority who couldn't afford an attorney? Which Wall Street "fat cat" is adding additional fees to every little fine so that getting pulled over for something as simple as not signaling a turn could end up costing hundreds of dollars for somebody who could end up losing his license and his ability to even work?While driverless cars hold a great deal of disruption potential, when it's all said and done, governments will remain largely undisrupted. Whatever changes are made in response will arrive well after they're needed and be badly implemented. The same people who suffered in the previous system will find no improvement in the next one. While one would hope the drastic reduction in traffic enforcement would result in better, smarter policing more focused on serious criminal activity, old habits die hard. Cops will just go where the driverless car ain't, rather than trim that area of law enforcement to the minimum required. And cities will cut programs deemed expendable, rather than subject their own spending habits to greater scrutiny.
by Tim Cushing
Mon, Mar 30th 2015 3:45pm
from the thanks-for-the-exploitable-tech,-US-citizens! dept
Two things remain certain in life: death... and law enforcement agencies using license plate readers obtained with Homeland Security grants for purposes not even remotely related to securing the homeland.
Here's how Newport News, Virginia's police department obtained its automatic license plate readers:
Grant money from a terrorism prevention program of the U.S. Department of Homeland Security through the Virginia Department of Emergency Management provided the funding for automatic license plate readers for several Hampton Roads agencies, including Newport News, Suffolk, Norfolk, Williamsburg, James City County, York-Poquoson and Isle of Wight, said Laura Southard, public outreach coordinator for the state's emergency management department.And here's what it's doing with them:
Hampton Roads law enforcement departments received $869,000 in 2009, $357,000 in 2010 and $143,000 in 2011 for license plate readers, Southard said.
Delinquent taxpayers in Newport News could have their vehicles impounded if new cameras snap a photo of their license plates around town.The terms "terrorism" and "drug enforcement" were likely thrown around during the application process, but the end result is the city viewing law enforcement technology as just another revenue generator. A "hit" from the ALPR will result in the vehicle being towed within three days if the delinquent taxes aren't paid off or a payment plan set up.
In an attempt to claim the nearly $4 million in delinquent personal property taxes owed, the city will soon begin using license plate scanners to find vehicles on which more than $200 in personal property taxes are owed.
The cameras will be mounted to the backs of six sheriff's department cruisers to automatically read license plate numbers. Those numbers will be cross-searched with a database updated daily of all the license plates in the city with more than $200 in personal property taxes owed, Treasurer Marty Eubank said.
While the city has every right to pursue delinquent taxes, it has no business re-purposing federally-purchased law enforcement technology to do so. Citizens concerned about ALPR databases housing millions of non-hit records have always been assured that this technology will be used to fight the baddest of the bad: drug dealers, terrorists, auto thieves, kidnappers, etc. But now it's being used to collect back taxes -- hardly the sort of thing Homeland Security funds should be used for.
Things get even more petty a little down the road in Hampton, Virginia. While Newport News' enforcement efforts don't kick in unless more than $200 is owed, Hampton is all about the Lincolns.
Hampton has one camera mounted to a city minivan, not a police vehicle, which is driven around town every week day, said Dave Ellis, field compliance supervisor in the Hampton Treasurer's Office. When field investigators find a vehicle with a license plate for which more than $5 in property taxes is owed, they first place a warning sticker on the vehicle telling the owner to make contact with the city. If there is no response from the owner after about a week, the investigators go back and remove the license plates or put on a wheel lock, Ellis said.Hampton's tax-collecting ALPRs were first deployed in 2008. It's left unclear how the usually "law enforcement-only" technology ended up in the city's hands, but most likely a Memorandum of Understanding allowed the transfer of the plate readers. To date, $1.4 million in federal funds have been dispersed to pay for law enforcement's ALPRs -- and now some of them are being used to track down $5 property tax deadbeats.
Isle of Wight doesn't even bother doing its own tax collection efforts. According to the article, this is outsourced to a private company with its own plate readers, meaning there's next to zero accountability. Turning a city job private keeps records related to tax collection efforts a little further away from curious constituents and their Freedom of Information requests.
Not that the Hampton Roads law enforcement network is too concerned about overstepping its bounds or potentially violating constitutional rights. As was covered here late last year, these same law enforcement agencies have built their own phone record database -- filled with data obtained from subpoenas, warrants and court orders -- which is shared between the multiple agencies with no apparent oversight.
Once you get past the re-purposing of federal funds for local tax collection, you arrive at the question of cost effectiveness. Hampton sends its city vehicle out every weekday to troll for plates. On top of the paycheck handed out to the driver(s), there's fuel and vehicle wear-and-tear costs to be considered, along with whatever's being paid to maintain the technology and its database. And yet, it seems satisfied to have collected $60,000 in unpaid taxes last year -- seemingly "break even" at best.
The bottom line is this: if you want to use ALPRs to catch delinquent taxpayers, then be upfront about this and use local funds to purchase the equipment. Don't simply use the technology because it's there. Using federally-funded plate readers is basically asking the rest of the US to fund your local tax collection efforts. And just like when law enforcement deploys these readers, there should be explicit, public information about how the data is collected, retained and destroyed. Sure, law enforcement agencies have been less than open about these factors, but at least they have the (poor) excuse that there are means and methods to protect. The cities doing this don't have anything to protect -- at least nothing that would (supposedly) threaten public safety if it were made known.
by Karl Bode
Wed, Jan 21st 2015 11:30am
progressive policy institute
That Study In Every Paper Claiming Title II Will Result In $15 Billion In New Taxes? Yeah, That's Total Bunk
from the damn-lies-and-statistics dept
The problem, as usual in farmed telecom think tank wonkery, was that the study's findings were largely bunk. Consumer groups were quick to complain (pdf) that study author Hal Singer packed the study with conflations, misleading math (when calculations weren't obscured entirely) and the inclusion of unrelated programs and issues (like 911 funding) to intentionally bloat the predicted impact. Singer also misleadingly included the unrelated temporary moratorium on Internet service taxation in his findings, even though the Internet Tax Freedom Act (ITFA) has since been made permanent, wiping $4 billion, or 27%, off of Singer's prediction in one fell swoop.
None of this of course stopped the study and the scary $15 billion tax estimate from being used by ISPs, CEOs and loyal politicians to wage war on Title II, and the study has since been regurgitated unskeptically in thousands of news reports. Well, except for the Washington Post, which recently decided to actually fact check the study's findings (journalism!), only to discover that even if you could accurately state the full financial impact of Title II, the report went out of its way to paint as ugly of a scenario as possible:
"It is impossible to quantify the exact impact of the potential FCC decision, since Internet regulation is a new area of policy. New taxes are prohibited as long as the Internet Tax Freedom Act is in effect, so it is inaccurate to say there would be $15 billion in new taxes. There may be state charges and fees, but there is no proof that all of the current fees on telephone services would apply again to Internet services. It will not add up to $15 billion, and likely not add up to $11 billion — the worst-case scenario. The researchers agree it is a “high-end” estimate, which was the purpose of the report."Amusingly, the Post's Michelle Ye Hee Lee contacted politicians that have bandied around the estimate, and few were interested in changing their positions when they were informed the $15 billion total was a phantom. Also of note, the story notes that Singer did at least edit his study when the Internet tax moratorium was introduced, but buried the update:
"There are too many unknowns to alarm consumers who are not well-versed in the technical and legal details of telecommunications regulations and laws. Given the uncertainties, it would be more appropriate to give a range of potential charges. But the researchers did not calculate a low-end figure for the report. In addition, the modification from $15 billion to $11 billion is a 27 percent decrease, yet the change is buried in a footnote and not readily visible for the public."Note that none of this is to say that Title II won't see some form of tax increase, but most analysts (the ones not trying to scare people) appear to think it will be somewhere in the range of not that big of a deal. Even if Singer was able to successfully calculate the myriad trajectory of dozens of Internet policies and tech trends to come to a hard number, he should have at least used his crystal ball to try and factor the cost benefits neutrality rules -- and a healthy Internet -- would have on the consumer. Would a tax increase be offset by the savings from not being price-gouged by neutrality-violating duopoly? How much would most consumers be willing to pay in additional taxes for a healthy Internet? These are questions Singer doesn't want to ask.
After being called out by the Post, Singer took to Twitter with a unique defense of his bloated, intentionally-inaccurate missive, only highlighting the part of the story that shows there may be some kind of tax increase: