Offshore tax evaders face carrots, sticks
But tax amnesties often don't help catch the big cheats, say some.
Manuel Balce Ceneta/AP
They all had the same question: Should they take up the Internal Revenue Service’s new offer of leniency for offshore tax evaders who come clean in the next six months?
Or should they risk the crackdown they might face if they don’t take up the offer?
With severe budgetary distress in Washington, the IRS is using both carrots and sticks to make those with illicit offshore bank accounts pay up an estimated $100 billion in unpaid annual taxes.
The carrots include a generous offer of leniency for offshore evaders, but experts say such tax amnesties often don't net more than a fraction of tax cheats.
It’s the small-time offenders who usually come forward under such amnesty schemes. The rest remain in the shadows, betting on the passage of time and inadequate IRS manpower to keep them safe – even when a famously secretive Swiss bank such as UBS buckles as it did in February under pressure from US federal authorities.