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December 5, 2022

Accounting News Roundup: Congress Playing Nice; Olympus Inquiry Going Deep; Loving the Payroll Tax | 02.17.12

Payroll-Tax Cut Pact a Rare Sign of Bipartisanship [WSJ]
A deal signed Thursday to extend the payroll-tax cut until year's end was reached with an efficiency and bipartisanship unlike any agreement in the current Congress. But it's unclear if that's an aberration or a sign of change. The deal was reached almost two weeks before a Feb. 29 deadline that could have triggered lower take-home pay for 160 million Americans. Other parts of the package permit extended unemployment benefit payments to continue and prevent steep payment cuts for doctors treating Medicare patients. The agreement was the product of unusual cooperation and relatively civil dialogue between the parties and the two chambers. House Speaker John Boehner (R., Ohio) called the deal "a fair agreement and one that I support," while Senate Majority Leader Harry Reid (D., Nev.) praised the GOP. "Everything should not have to be a fight," Mr. Reid said. "I hope this shift to the middle becomes the norm rather than the exception."

Payroll tax vote divides GOP [The Hill]
The vote to extend the payroll tax holiday on Friday will highlight a stark contrast between Republicans leaders in the House and Senate. While House GOP leaders are reluctantly backing the agreement, most Senate Republicans are expected to vote against it. This will be the first time that Speaker John Boehner (R-Ohio) and his lieutenants will be voting differently than their Senate counterparts on a high-profile issue in the 112th Congress. 

Arrests in Olympus Scandal Point to Widening Inquiry Into a Cover-Up [NYT]
Arrests of seven people Thursday accused of involvement in the $1.7 billion accounting scandal at Olympus, including the company’s former chairman and executive vice president, point to a widening investigation into a cover-up ostensibly carried out by top management with the help of a group of former bankers. Tsuyoshi Kikukawa, who was the company’s chairman until the scandal broke last fall, was arrested in Tokyo as were two other former executives on suspicion of having falsified financial statements, Tokyo prosecutors said. Two former Nomura investment bankers who had been previously mentioned by investigators were also taken into custody, accused of violating securities laws, and so were two of the bankers’ associates. By aiming a spotlight on what critics say is Japan’s lax corporate governance, and casting a shadow over one of the country’s former blue-chip companies, the Olympus scandal has become a test of how far Japan is willing to go to fight white-collar crime.

Facebook CFO advises Menlo Park council not to push company away with unreasonable demands [PADN]
When Menlo Park officials sit down with Facebook representatives in the coming weeks to negotiate an agreement that would allow the social networking company to expand, they'll likely try hard to avoid making their requests for community benefits sound like a Mafia shakedown. Although the company is not threatening to unfriend Menlo Park any time soon, Facebook Chief Financial Officer David Ebersman told the city council Tuesday night it may choose to eventually leave if the negotiations go nowhere. "I believe the discussions over the next few months will prove to be the seminal critical conversations that will determine whether or not Facebook will move forward with our plans to plant our long-term roots in Menlo Park and become deeply imbedded in the community," Ebersman said.

IRS Warns on ‘Dirty Dozen’ Tax Scams for 2012 [Total Return/WSJ]
FYI.
 
The Buffett Tax Rule Is Really More of a Guideline [NYT]
President Obama has made the Buffett Rule, mandating that millionaires pay at least 30 percent of their incomes in taxes, the centerpiece of his campaign for “fairness.” But look for it among the myriad tax changes the White House detailed in the 2013 budget proposal it released this week, and you will not find it. The Buffett Rule has become a signal piece of election-year political rhetoric. It featured heavily in Mr. Obama’s State of the Union address last month. It has become a favored talking point on the campaign trail. And Mr. Obama underscored his support of it in his budget proposal. But the White House says it is a “guideline,” rather than a legislative initiative. And it says it prefers not to establish the Buffett Rule without a broader overhaul of the tax code, though it would support a Congressional effort to carry it out alone.
 
How I Learned to Stop Worrying and Love the Payroll Tax Cut [Christopher Bergin]
You can do it, too!
 
International Crackdown On Tax Crimes Intensifies [NYT]

The global body that sets standards for combating money laundering and terrorist financing said Thursday that governments should treat tax crimes as a red flag for other types of financial malfeasance, a sign that international cooperation against tax cheats is gaining momentum. The body, the Financial Action Task Force, said it was expanding its list of “predicate offenses for money laundering” to include serious tax crimes.

 

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