August 20,2009

Baucus: UBS Settlement An Important Step In Fight Against Offshore Tax Fraud, More Work Still To Do

Finance Chairman continues push on proposals to detect, deter, discourage offshore tax evasion

Washington, DC – Senate Finance Committee Chairman Max Baucus (D-Mont.) said the terms released yesterday in the Internal Revenue Service (IRS) settlement with UBS AG, a global financial services company based in Switzerland, represent an important step in the effort to end offshore tax evasion. At the same time, Baucus said much work remains to be done in the field of offshore tax evasion and reaffirmed his commitment to fighting such abuses.

“This settlement is an important step in the fight against offshore tax fraud and I welcome the diligence the IRS has shown to resolve this case. Still, the fight is far from over,” Baucus said. “We do not know whether the UBS scams represent the iceberg or the tip of the iceberg and I am eager to find out more about this issue. I look forward to examining the details of this settlement and will continue working with the IRS to provide them the tools it needs to combat and prevent such abuses.”

The IRS filed suit against UBS in February, seeking information on Swiss accounts used to hide income for the purpose of evading U.S. taxes. The IRS reached a settlement with UBS last week and terms announced yesterday require UBS to turn over the details on an estimated 4,450 accounts that meet criteria agreed upon by the IRS and the Swiss government. It is hoped the settlement will provide the IRS with a blueprint for obtaining such information in future cases involving foreign accounts used to commit U.S. tax fraud.

Chairman Baucus has a long history of working to end tax abuse and narrowing the $345 billion annual tax gap remains among his top priorities. In March, Baucus issued a preliminary staff draft of proposals that would give the IRS better tools to detect, deter and discourage offshore tax evasion and make it easier to prevent offshore abuses such as those that occurred in the UBS case. He expects to move this legislation in the coming months.

The Finance Committee has jurisdiction over the U.S. tax code.

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