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SANTA FE, N.M. (AP) A new state law will offer a tax break to encourage businesses to hire veterans who recently left the military and New Mexico also will give an advantage to veteran-owned businesses bidding on government contracts.

Gov. Susana Martinez signed the measures on Wednesday, as she met a deadline for acting on bills that passed the Legislature during its 30-day session.

Businesses can receive a $1,000 tax credit for hiring veterans within two years of their discharge from the military, which the governor says will help personnel returning from Iraq and Afghanistan. The tax incentive will be available starting this year and end in 2016.

"Our men and women in uniform make tremendous sacrifices to protect our safety and freedom," Martinez said in a statement. "It is unacceptable that these heroes might come home from Iraq and Afghanistan only to stand in the unemployment line.

Starting in July, businesses owned by veterans in New Mexico will receive a bidding preference on state and local government contracts. House Speaker Ben Lujan, D-Santa Fe, sponsored the proposal. The governor said it will "boost job growth in New Mexico's veteran community."

Also signed was a bill to require legislators to contribute more into their pensions, boosting it from $500 a year to $600 a year. The governor said in a statement that the contributions by legislators "are woefully inadequate in comparison to the taxpayer-funded benefits they generate."

"Given the generosity of these legislative pensions, and the significant expansion of these benefits throughout the years, I believe that voters should have the chance to weigh in on this important issue and evaluate the appropriateness of these pension benefits," Martinez said.

Martinez vetoed several proposals, including ones to:

Create three additional judgeships in Bernalillo and Sandoval counties. The governor said lawmakers didn't fully finance the positions, but Arthur Pepin, director of the Administrative Office of the Courts, disagreed. He said there was enough money in the bill and a state budget measure to pay for the judges and support staff during half of the next fiscal year. The judgeships wouldn't be created until January 2013, which meant that they initially needed money for only six months of the budget year.

Allow counties to increase the salaries of their elected officials by as much as 15 percent. The measure would have raised the cap in state law on salaries of county officials, including sheriff, treasurer and assessor. However, it would be up to county commissioners to decide whether to provide a pay increase. The governor objected to the potential increase in taxpayer spending, saying government finances remain uncertain.

Originally posted here:
Governor approves tax break for hiring veterans

A City law firm is warning of an "increasingly aggressive" approach by HMRC to investigations into high-earner contracts, including those awarded to expats in the banking sector

New rules concerning so-called "disguised remuneration" have been introduced to prevent people avoiding tax on income by having money paid into Employee Benefit Trusts (EBTs). Law firms now fear that public sentiment towards high-earners is encouraging tax inspectors to take an aggressive stance against disguised remuneration, even on legitimate contract structures.

"Many expats will have benefitted from Employee Benefit Trusts, or other income tax planning arrangements, and assumed that they have no risk of a personal liability. However, in some cases employees will not be insulated from HMRC enquiries and claims, so will be at risk," said Damian Bloom, tax partner at law firm Berwin Leighton Paisner (BLP).

The recent investigation into Glasgow Rangers shows that HMRC is taking a much tougher line on the use of Employee Benefit Trusts to pay high earners, a practice that is in widespread use among banks and hedge funds in particular.

BLP believes that nearly 300 similar investigations are currently underway across a broad range of sectors, not just limited to the sporting world. Tax inspectors are using new powers of investigation to crawl through structures set up years ago and accepted at the time as legitimate tax planning.

Rangers used EBTs to pay players' wages into offshore trusts in order to avoid national insurance. HMRC is claiming that because the EBT was written into employees contracts, it is not discretionary and found the club owed 43 million in tax, forcing the club into administration. The potential penalties for banks and funds could be significantly higher.

"There has also been a worrying shift in attitude by HMRC in a number of civil investigations it is using language normally reserved for criminals, which is symptomatic of its increasingly aggressive approach," said Neal Todd, another tax partner at BLP.

The firm is currently working on a case defending a banking client against a charge of disguised remuneration. The outcome of that case will determine whether or not other firms employing expats are at risk of similar sanctions.

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Tax warning to expats in banking sector

The Senate adopted an amendment to a larger highway transportation bill on Thursday aimed at cracking down on foreign tax havens.

Carl Levin

The amendment would allow the Treasury Department to take a range of measures against foreign governments and financial institutions that significantly impede U.S. tax enforcement. The amendment was offered by Senators Carl Levin, D-Mich., Kent Conrad, D-N.H., and Sheldon Whitehouse, D-R.I. The provisions had been part of legislation that Levin has been pushing for since 2007, most recently as part of his CUT Loopholes Act (see Senators Introduce Bill to Cut Tax Loopholes). The provisions would not be as broad as those in the larger bill, but they have raised concerns in the financial services industry.

I have fought against offshore tax havens for years, and I am glad the Senate has taken a strong step in the fight against foreign governments and offshore banks that help privileged individuals and corporations dodge taxes while the rest of Americans have to shoulder the extra tax burden, said Levin, who as chairman of the Senate Permanent Subcommittee on Investigations has conducted lengthy investigations of the damage done by offshore tax havens. Enactment of our amendment would help make our tax system more fair and would help reduce the deficit.

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Under Section 311 of the Patriot Act, the Treasury can take a range of measures against foreign governments or financial institutions that engage in money laundering. The senators amendment gives the Treasury the same tools to combat foreign governments or financial institutions that significantly impede U.S. tax enforcement. For example, the Treasury could prohibit U.S. banks from accepting wire transfers or honoring credit cards from banks found to significantly hamper U.S. tax enforcement efforts.

"This legislation will grant the Treasury Department a new tool to stop offshore tax havens and financial institutions from gaming the system, said Conrad, who chairs the Senate Budget Committee. More must be done to clamp down on these tax havens and other schemes solely designed to get around current tax laws. This amendment is common sense and could raise nearly $1 billion to help tackle the nation's deficits and debt.

Levin noted that over the last several days, he and his co-sponsors had worked with the Obama administration and others to improve the amendment. They made changes to clarify that it covers significant impediments to tax enforcement, and that foreign jurisdictions and financial institutions that are complying with the Foreign Account Tax Compliance Act will be viewed favorably with respect to their level of assistance with our tax enforcement efforts.

Its time to put an end to offshore tax abuses that allow tax cheats to profit at the expense of honest taxpayers, said Whitehouse. Im proud to support Senator Levins amendment, which will give the U.S. Treasury greater powers to crack down on offshore tax abusers and the banks that aid them.

Levin noted that Congress took a step two years ago by requiring foreign banks with U.S investments to disclose accounts opened by U.S. persons or pay a hefty penalty on their U.S. income. That law, known as FATCA, was included as part of the HIRE Act of 2010. But Levin noted that FATCA does not apply to tax haven banks that avoid U.S. investments. The United States needs authority to take special measures against foreign banks that not only refuse to disclose accounts opened by their U.S. clients, but also significantly impede U.S. tax enforcement efforts, he said. Our amendment would enable the United States to fight back by authorizing the Treasury to tell U.S. banks to stop doing business with those aiders and abettors of U.S. tax evasion.

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Senate Passes Amendment to Fight Offshore Tax Abuses

MARIA SLADE

One of the country's highest-paid chief executives is leaving Westpac New Zealand to take over the top job at Australia's St George Banking Group.

George Frazis was paid $5.4 million in the year to September 2011, the second year in a row his pay topped $5m.

The figure made him almost certainly the highest paid chief executive in New Zealand that year.

Westpac said Frazis' New Zealand replacement would be Peter Clare, a former senior manager at St George, Westpac and CBA.

"George Frazis has done an excellent job over the past three and a half years in significantly improving the performance of the New Zealand business," Westpac chief executive Gail Kelly said.

Cash earnings for the New Zealand business increased 41 per cent in the 2010/11 financial year.

"George has implemented a strong strategy to achieve growth across all market segments and to build a partnership with customers and the community. In particular, Westpac New Zealand's continued efforts in providing strong support for customers, the community and staff following the Christchurch earthquakes are a reflection of his commitment to this partnership."

Peter Clare was one of the Westpac Group's most seasoned executives, the bank said.

In his role as group executive products and operations, he led a division of 5000 people, providing key support across the businesses and driving performance. He is currently the chief operating officer of the group's Australian Financial Services business.

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Westpac NZ chief heads offshore

THE Reserve Bank has turned down applications by Standard Chartered Bank and Barclays Bank to keep over 25 percent of their Nostro account balances offshore as it emerged yesterday that some banks had partially complied with the directive to transfer 75 percent of their funds to onshore accounts.

RBZ Governor Dr Gideon Gono yesterday said the central bank will descend heavily on the truant banks.

Statistics show that Nostro balances for 22 banks stood at US$312, 6 million as of yesterday, instead of US$230 million had all the banks heeded the RBZ directive.

At least US$82 million was outstanding as of yesterday.

"The Reserve Bank of Zimbabwe shall be meeting with banks that have not complied with a view to taking stern measures to ensure compliance," Dr Gono said last night.

Figures showed that as of yesterday, Standard Chartered had US$109, 3 million as its Nostro balance, instead of keeping US$28,4 million as per the new requirements.

The variance, therefore, stood at US$81 million.

The bank had its request for a dispensation to keep funds in excess of the 25 percent requirement turned down by the central bank.

Standard Chartered said it needed to keep the funds offshore to facilitate disbursements to clients.

Barclays had a Nostro balance of US$37,4 million as of yesterday, but had not complied.

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Zimbabwe: Offshore Accounts - Banks Defy RBZ