Panama Papers, the IRS-UBS Lawsuit & Tax Notes International

Spotlight
03 May 2016
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Taxlinked (TL): You participated in the U.S. lawsuit against Swiss banking giant UBS that sought to disclose to the IRS the identities of Americans with undisclosed bank accounts. Tell us a bit about your role as litigator in the case. Also, how has this watershed settlement altered U.S.-Swiss business relations?

Stuart Gibson (SG): As senior litigation counsel at the Tax Division of the U.S. Department of Justice, I was assigned to file and litigate the lawsuit to enforce a “John Doe” summons issued to UBS, to compel the bank to identify Americans who had undisclosed Swiss accounts. I was responsible for preparing and filing all pleadings and briefs in the case, appearing in court, and taking the deposition in London of the bank’s expert witness on Swiss privacy law.

It is hard to understate the impact of the eventual settlement of the case on the tax and financial world. The matter was settled on the eve of trial, with Switzerland and the bank agreeing to provide information to the IRS about thousands of accounts. Soon thereafter, the U.S. Congress enacted the Foreign Account Tax Compliance Act (FATCA) and the IRS began the first of its offshore voluntary disclosure programs. Both profoundly altered the global financial landscape, leading other countries to adopt similar voluntary disclosure laws, and the OECD to adopt the common reporting standard (CRS) for financial disclosures.

TL: Was your transition from tax litigator to journalist/editor an easy one? What was the biggest challenge for you during this period?

SG: The transition from litigator to journalist was not a direct one and came only after I tried and failed at retirement. It helped that, before coming to work at Tax Analysts, I was hired to write the chapter on IRS summonses for the 3rd Edition of Saltzman & Book on IRS Practice and Procedure. That experience during the summer of 2014 helped me develop the discipline to write concisely on short deadlines.
 
The biggest challenge was to develop the discipline to write short commentary pieces on a weekly deadline, in an interesting, engaging style.

TL: Overall, what is the main objective of Tax Notes International? Also, what are its readership’s demographics?

SG: Tax Notes International is published by Tax Analysts, a nonprofit organization founded in the 1970s to foster a free, open, and informed discussion about taxes. Our readers are the most influential thinkers and policymakers in international taxation, and include leaders in accounting, law, finance, business, education, tax policymaking, and tax administration.

TL: In terms of your position as editor of Tax Notes International, how do you decide the stories that deserve to be run? How does the editorial process work within the nonprofit publisher?

SG: Our objective at Tax Notes International is to publish current tax news of general interest, along with well-written pieces of commentary and analysis that inform discussion and debate over issues involving tax policy and administration, as well as the development and implementation of tax policy. We receive manuscripts, both solicited and unsolicited, from around the world. They are reviewed by our experienced staff of editors, who choose pieces that advance the discussion. We welcome commentary and analysis from all sides, and do not take an editorial position on any issues.

TL: What are your thoughts on the recently leaked Panama Papers? Do you think these revelations will lead to any sort of change in the way some firms or jurisdictions handle international taxation matters?

SG: The Panama Papers leaks showed the vast majority of the world what was otherwise known only to the rich and powerful – how to move and manage money without anyone knowing. As with the world’s response to UBS revelations, this story is likely to lead to changes in how countries monitor financial transactions, and exchange financial and tax information. There will always be ways for people to hide their financial dealings. But when fully exposed, the Panama Papers revelations will make it much more difficult to do so.

TL: Any other thoughts you would like to share with our community?

SG: Members of the TaxLinked.Net community who would like to know more about submitting commentary pieces for publication in Tax Notes International are welcome to contact me at Stuart.Gibson@taxanalysts.org.