This video from the USA is called Thom Hartmann (July 19, 2012): Bain Capital and El Salvador death squads.
From daily The Morning Star in Britain:
Monday 03 September 2012
by Our Foreign Desk
New York’s attorney general is investigating the tax strategies of some of the largest private equity firms in the US, including Bain Capital, the company founded by Republican presidential candidate Mitt Romney.
It emerged at the weekend that attorney general Eric Schneiderman is examining whether the firms have abused a tax strategy to avoid paying hundreds of millions of dollars in taxes.
The practice involves converting management fees collected for handling investors’ accounts into fund investments, so resulting in a lower tax rate.
Some tax experts who spoke to the New York Times, which reported the investigation on Sunday, warned that the strategy was potentially illegal, although other experts linked to the companies claimed it was commonplace.
The attorney general sent subpoenas to more than a dozen firms, including Kohlberg Kravis Roberts & Company, TPG Capital, Sun Capital Partners, Apollo Global Management, Silver Lake Partners and Bain Capital, according to the official.
Bain Capital has been a high-profile target of the Democrats as they seek to portray Mr Romney as someone willing to close businesses and lay off workers in pursuit of profit.
Mr Romney has claimed that lessons he learned at Bain Capital would help him as president to fix the economy and create jobs.
The tax strategy of converting management fees into investments producing capital gains can be attractive to fund managers because capital gains are subject to a federal tax rate of 15 per cent in the US, which is far less than the top rate of 35 per cent for ordinary income.
The “management fee waiver” strategy is widely used within the industry, the New York Times has claimed.
At least $1 billion (£630 million) in accumulated fees that otherwise would have been taxed as ordinary income for Bain company executives had been converted into investments producing capital gains, according to Bain financial documents leaked online.
Bain partners were able to save more than $200m (£126m) in federal income taxes and more than $20m (£12.5m) in Medicare taxes, according to the newspaper.
The US Internal Revenue Service has not yet ruled on whether the waiver strategy complies with tax law and expert opinion varies.
Romney’s Bain victims set up protest camp: here.