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McCaskill complicit in “largest tax scam in the world”

May 4, 2009

JEFFERSON CITY—Calling offshore tax evasion the “largest tax scam in the world,” President Obama this morning unveiled a proposal to crack down on offshore tax havens—a plan that may ensnare Senator Claire McCaskill. Among other things, Obama’s proposal would criminalize the use of tax shelters similar to the Bermuda-based company owned by McCaskill.

“McCaskill is complicit in what her ally, President Obama, calls the ‘largest tax scam in the world,’” said Lloyd Smith, Executive Director of the Missouri Republican Party. “For years, she has covered up the existence of her tax shelter and obstructed efforts to determine whether she is paying her fair share of taxes. Until McCaskill shuts down her tax shelter, she will have to answer questions every time this issue is raised.”

In March, McCaskill was criticized for cosponsoring legislation that would crack down on tax havens, despite her family’s own Bermuda-based shelter, a company called Rural Reinsurance Company International, Ltd. McCaskill continues to deny that the company is a tax shelter, but that claim is disputed by ethics watchdogs and her own previous statements:

During her 2006 campaign, McCaskill acknowledged that the company existed as a tax shelter. According to an October 18, 2006 Kansas City Star article, McCaskill said, “There is absolutely no tax sheltering that is occurring that is not part of a tax code that Senator Talent embraces. ”
In the same article, ethics watchdog group Citizens for Tax Justice went even further: It’s all about avoiding taxes, said Robert McIntyre, director of Citizens for Tax Justice, a Washington watchdog group. “That’s the whole point of them. I’ve heard so many excuses for doing it. But why is it in Bermuda? There’s only one reason. Because of taxes.”
An October 19, 2006 article in the Kansas City Star noted that, “Tax authorities and congressional investigators have long been concerned about taxation aspects of such entities [Bermuda-based reinsurance companies], set up by both individuals and big companies. IRS Commissioner Mark Everson has urged Congress to help curb some of the most egregious abuses.”