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Mo' money, mo' problems for Snipes

 
Date: 25-Apr-08  
Even if you're a Hollywood star, the courts don't take kindly to you refusing to pay income tax...

US actor Wesley Snipes has been given the maximum sentence of three years in prison after being found guilty of tax evasion. The trial followed almost ten years of ‘brazen defiance’ of the US Internal Revenue Service, during which the star of Blade and White Men Can’t Jump refused to pay tax on nearly $60m of income. Apparently some dodgy advisers managed to persuade him back in 1999 that the whole tax thing was entirely voluntary, and ever since he’s been busy concealing funds offshore, falsely applying for tax rebates and challenging the authority of the IRS.

Believe it or not, this ‘tax denial’ idea is quite a popular movement in the US. Its proponents say that they’re not technically required to pay income tax on domestic earnings, basing their argument on some dubious interpretations of old court rulings and constitutional amendments (since rejected by the courts). Snipes appears to have fallen hook, line and sinker for this idea when it was peddled to him by his tax advisers, and has since been engaged in a long-running battle with the IRS.

However, the prospect of being banged up seems to have induced a moment of clarity. Snipes has been apologetic throughout the trial, describing himself as ‘unschooled in the science of law and finance… well-intentioned, but miseducated’, and suggesting he had been hoodwinked by advisers (who are also going to jail). He even got his lawyers to try and hand over cheques totalling $5m to the judge during the trial, but got short shrift.

But judging by the sentence, his pleas for leniency – and the thirty-odd character references from such Hollywood luminaries as Woody Harrelson and Denzel Washington (‘Wesley is like a tree - a mighty oak’, the latter rather curiously suggested) – have clearly fallen on deaf ears. Snipes’ lawyers are complaining that it’s unfair for the courts to make an example of him just because he’s famous (‘Mr Snipes was sentenced because he’s Mr Snipes,’ one said, which seems unarguable on a number of levels), but that’s obviously the plan here.

And given how much is at stake, it’s not surprising. If the government gives even the slightest ground on this point – by suggesting that you can get away with refusing to pay taxes – it could really let the genie out of the bottle. Most of us hand over our taxes to the government without really thinking about it, half the time – the last thing the Man wants is for everyone to suddenly start questioning the basis on which the whole economy is run.

On the other hand, Snipes isn’t in prison yet, and apparently his lawyers are already planning a raft of appeals – so whether he’ll actually serve any time is debatable. And given that he’s a martial arts expert, we’re sure he’ll be able to look after himself even if he does...

 
 

Comments

J Potter - 25-Apr-08

unschooled in the science of law and finance… well-intentioned, but miseducated’ - I've never heard the art of financial fraud described like that before. To quote another well known black actor, Mr T: "Fool!"

segun osu - 25-Apr-08

Quoting "another well known black actor" hardly helps explain this. Taking a snipe at Snipes really does not add anything useful.

Take a closer look at other, slightly more accurate sources - "Snipes was cleared in February of five charges including fraud and conspiracy, but convicted on lesser charges of failure to file a tax return. During the three years he failed to file a tax return, Snipes earned at least $13.8m (£7m), prosecutors alleged, and would be liable for $2.7m in taxes. Snipes said he owed $228,000"

Most highly paid people think that they can get away with paying relatively little or no tax. However, with ever more complex tax legislation, advisers are necessary and it is very likely that whilst clearly not a Fool, he is unschooled in more complex tax matters.

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