Finance committee  I thank the committee for the invitation to make this presentation. My name is H. David Rosenbloom. I am private a tax attorney and a professor of tax law at New York University's School of Law. I have specialized for nearly 40 years in international or cross-border taxation.

Finance committee  Yes, of course. I think there's a long tradition of secrecy of tax information, and there are reasons for it. Tax administration in my country and in many countries depends on achieving a certain level of willingness of the taxpayer to comply with the laws, and it is thought tha

Finance committee  Should I respond to that, or no?

Finance committee  Yes. I think it's important to distinguish the various subjects that have been talked about by all three of us. We're talking about a wide range of related but distinct issues. If the committee tries to do everything, it will end up doing, in my opinion, very little. It really

Finance committee  I'm quite familiar with TIEAs. I negotiated one on behalf of the Government of Liechtenstein with the United States. I'm a skeptic about TIEAs or exchange of information provisions having a very broad effect, because they tend to be one-off agreements. I don't disapprove of them

Finance committee  Yes, I am quite familiar with transfer pricing. I've taught full semester courses on it for several years. I haven't done it recently, but I do a lot of transfer pricing work myself. Let me first of all describe what we're talking about. Transfer pricing refers to the price char

Finance committee  I applaud the involvement of political leaders in the whole tax area. I think tax is critical. You can't have a democracy without a functioning tax system, so I'm all for the G-8 and the G-20 being involved. However, at the current stage, we're in a very highly technical area he

Finance committee  They're very related—no doubt they're related—but if you put them all together and try to resolve them all with any one group or single approach, you're not going to end up solving any of them. It seems to me that a committee of the Parliament in Canada is going to be most able

Finance committee  Let me start with your second question, because I can do that fairly easily, I think. Let's say you have two related entities, A and B. A provides some kind of value to B, whether it's goods or services or loaned money, or whatever it provides, and B pays A for that value. What

Finance committee  That's a very fair question. In my experience, most publicly owned corporations do not often engage in criminal behaviour in the tax area. What they're doing is by and large legal; the problem is that the laws allow them to take fairly aggressive positions. The biggest constrain

Finance committee  Absolutely. This is a rule-based system. This isn't just a lot of concepts and research: we have to have rules.

Finance committee  Well, yes. Again, I'm influenced by the U.S. experience, but I think we make a huge mistake in trying to put a one-size-fits-all rule out there so that we treat these tax havens the same as Japan. To me, that's tying one arm behind our back. The other thing we do in my country—I

Finance committee  I have a specific suggestion that might actually make some sense for you to think about. I think it would make sense in this area—and probably other areas, but let's limit it to this—for a relatively limited group of developed countries to get together, maybe on an ongoing basis,

Finance committee  I'm not sure I'm qualified to answer that. I'm not an economist, and these macro effects are just things I read about with interest. The only thing that I would comment on, that your question prompts me to observe, and that is I think quite interesting and worth thinking about,

Finance committee  Yes, of course. The worst aspect of FATCA is what it did to the United States. It basically deflected large numbers of our resources into writing these incredibly detailed rules for something that's not going to produce a lot of revenue. It never made much sense to me to take pe