As much as the wealthy rightly get shit on for various things, they are still entitled to the same rights as everyone else.
You said that the rich are entitled to the freedoms as anyone else but shrugs off that only the rich have the effective means to make use of these instruments. They are quite capable of being completely invisible to public scrutiny by holding all their assets as an individual.
They choose to take steps to leverage opaque often intentionally complicated corporate layering schemes to minimize risk, skirt (legally or not) tax, or to layer the sources of bad money.
Whatever the reason for engaging in these games, I believe they are no longer "living life like every citizen deserves privacy" (note your comment spoke of total privacy from oversight which no citizen pretty much anywhere actually has).
I'm at least happy that my home of Canada is starting to chip away the corporate veil.
Think about what it would mean that anyone could, at any time, look up all the investing choices of anyone in the country.
It's totally a thing to have trades pegged to US politicians' investment choices, because they often have the knowledge not available to the public to make "better" (financially) decisions.
As per your first comment, this is generally the difference between an active and passive investor which usually works out to someone who owns about 10% of any given company. It's probably a little too high as it isn't hard to imagine a cabal of 11 wealthy tax dodgers playing games with the reporting requirements.
I believe most laws getting enacted which are addressing corporate secrecy are primarily targetting the active owners of companies and usually unnamed beneficiaries who have a benefit to the company/trust who aren't specifically owners, who can reap the benefits of the company's assets without strictly their name of the deed so to speak.
Again, most of this revolves around what is asked by government officials for auditing and less about what information is being dumped into public information.
However, note that the CRAs information collection did not make your personal bank account information public. Would you prefer that it had? I used the example of a blind trust here because "non-blind" trusts are one of the common uses of non-commercial corporate entities.
Also, I never once said "total privacy from oversight", all these corporate entities already supply financial and ownership information to the government, whose job it is to hold them to account. This is not the same and making information public so a rabid mob of people can enact vigilante justice, or whatever people like you hope comes out of it.
How does this hurt anyone though? That is not clear at all. The thing you're upset about here is that blind trust members information is reported to the government, but with no clear statement how this hurts anyone, wealthy or not.
Chances are, the information turned over the government has anyway.
If this is a legal mechanism to circumvent probate taxes, then its not a problem. If not, well, even regular people should pay their taxes, no?
Taxes aren't an ethical or moral topic, they are a legal topic. If you can avoid a tax through some legal structure, you are within your rights to do so and you can't judge this as some sort of shady business. Taxes are mostly used to create incentives and collect money, if people are allowed a legal structure to avoid a probate tax, then that might be an incentive on purpose. Just because you did something to pay less taxes does not mean that you are some bad actor exploiting a loophole.
For example, taxes are only paid on profit, so companies are incentivized to spend their money and pay less in taxes. No one sees this as a legal loophole that needs to be fixed, it is very much intentional.
Also you are making the false dichotomy here of "regular people" as something different from "somewhat versed in financial entities people". That's weird.
Sure you can. Legal tax avoidance gets judged all the time. See the Jimmy Carr tax "scandal" that was legal, and yet he received public pushback.
Allow me to make it clear.
https://www.smithsonianmag.com/history/1938-nazi-law-forced-...
If someone wants to argue you shouldn’t have to register things with the government I’m all ears but it is no way comparable to what the Nazis did.
The wife passes away.
1. Should her husband pay tax on her share of the house when it passes to him? Assuming these are not wealthy people, this may force the sale of the house.
2. Should the house go through probate? Should everyone move out while that happens?
The old man wants to leave the house to his son.
3. Should the son pay tax on the house when his father passes away?
4. Should he move out while the house goes through probate?
It is because of cases like these that we have ways to avoid going through probate.
A tangent, but this is in and of itself completely nuts. One should be able to read the text of the law, as written, and understand what you are and are not permitted to do - end of story. There should be no need to look at precedents. Courts only recourse if a law is unclear should be to send it back to an elected legislature for refinement.
Has there ever been a time when the wealthy had less rights than the poor?
The speeding ticket fine which is charged as a percentage of ones wage comes to mind.
https://www.theguardian.com/world/2023/jun/06/finnish-busine...
And no, generally the more rich and/or powerful you are the more rights society provides you. Even countries which strive for more equality simply try to shore up the most egregious instances but there’s always a difference. That’s because not all rights matter equally to everyone.
For example, rich and poor both don’t have the right to sleep on a park bench but in practice that right is only particularly relevant to one party.
That's an interesting view. One could argue that a flat fine allows rich people to break the law more, because they can afford it. Which IMHO seems pretty unfair.
Some states allow you to claim anonymously, while others don't. For those that don't, you may be able to claim under an LLC, with your name and address "hidden".
Edge case, but I think it's legitimate.
We're not talking about individual assets though here – we're talking about the distribution of resources in our society and the people who own these resources have power over lots of other people.
Essentially - have US$1bn is structurally different to owning US$1 million.
Who runs a corporation 100% should not be a secret, ever.
I'd argue instead that the public's need to know sometimes outweighs an individual's right to privacy.
But in any case, even if privacy was broadly recognized and protected (it isn’t, otherwise the government wouldn’t be allowed to buy your information from data brokers) that still leaves open the question at hand.
Any offshoring calls that into question.
> they are still entitled to the same rights as everyone else
No, they're entitled to more because they can afford the services of those who can setup shell company structures to hide their wealth and their identities.
Also, "It's 100 legal" is a pretty hilarious rejoinder to someone discussing changing what is legal.
Unless they want do that, they can endure extensive scrutiny.
If any billionaire wants all the "extra" rights of being a normal citizen I'd be glad to swap anytime.
It's in the public interest to understand what very powerful people are doing , because the public are usually getting the short end of the stick- this should override any ideology regarding 'privacy', 'freedom' and other fuzzy words (not that some interpretation of these things isn't also important)
Pseudonymity is perfectly valid, but there needs to be efficient, effective, and crystal clear means to pierce it and find the actual humans making the decisions with intent when there is a legitimate and well-supported legal need.
There are enough high profile cases of shell corporations being used for unsavory and explicitly illegal behavior, to the extent that it is literally a meme, such as the crimes unveiled in the Panama Papers [1] that simple and robust mechanisms to prevent abuse are warranted even if abuse is uncommon. It is not like being able to pierce the privacy with a court order is even some new mechanism, you can already do that, it is just expensive, time-consuming, and difficult if they fight.
It is then easy for you to take the first step in the cost-benefit analysis you wish to do by estimating the costs. The proposal is that a court order demanding disclosure, which are already routinely issued, can not be stalled indefinitely through the application of lawyers. So, all you need to do is identify the balance of cases where disclosure is fought and then see how often the disclosure results in illegitimate harm to the disclosed party versus how often it results in the discovery of legitimate harms caused by the disclosed party.
The disclosures in the Panama Papers alone resulted in 1.2 billion dollars of recovered taxes [1]. So you can compare the estimated costs against the benefits of preventing a singular incident for now. If you can present credible evidence that the harms of requiring disclosure on legitimate court orders is in excess of that, then a broader analysis of the problem size if warranted.
[1] https://www.icij.org/investigations/panama-papers/panama-pap...
> frequently abused to not only protect privacy, but to protect against legitimate legal need
Shell corporations are used for unsavory purposes being a meme is not proof of this as was implied by your other comment. Also 1.2B in taxes is pocket change so it doesn't really help your point.
Trusts in general are simply good estate planning compared to probate costs, at least on the topic of real estate holdings and titling.
To address inevitable replies: No, I don't know exactly where the line is (or lines are - it should probably be a tiered system), and I recognize defining those lines is itself a position of immense power. Those are solvable problems though and don't make the idea bad. (It could still be a bad idea, but for other reasons.)
the default for normal people is for all of this data to be public unless you can either navigate bureaucracy (costs time and money) or pay someone to do it for you (costs money)
A more wealthy individual has no such privacy. Their wealth is not truly wealth and not truly theirs, it is fundamentally a trust-us IOU from a bank or a stockbroker which is shared with all kinds of parties, a publicly visible number on the screen which at any second could turn zero or negative on the orders of a corrupt official or due to a buggy algorithm or mistyped name on a sanctions list.
The more wealthy individual yearns for a glass jar - but no jar is big enough to hold the sums the more wealthy individual operates with.
Hence, shell companies.
The owners of an abortion clinic, or a store that sells fur coats, or a therapy practice for the criminally mentally ill, all might have good reasons why they’d like additional privacy.
Further common situations involve trying to keep details out of the public record because they can be abused by bad actors; ones who may be looking to spam you, engage in a frivolous lawsuit, or personally harass you/your family. At least these are some of the scenarios mentioned by companies that do asset protection.
Edit: In regards to harassment, think about the abuse retail, fast food, or other customer-facing employees endure for perceived slights. It feels easy to understand why average small business owners would want privacy and to keep things in legal channels. Personally, I think the government knowing who's in charge (Corporate Transparency Act) is a good halfway point, but it's not unrealistic to be concerned about leaks or abuse with that system.
Have you formed an entity? In Delaware it’s file and go. You don’t need a lawyer nor to fill out a bunch of paperwork. That’s efficient. Where we demand disclosure is when that entity touches money through the banking system.