Outside of an IRS audit, fewer things are more scary than a good suspense movie.
One of the best is Hitchcock’s 1954 masterpiece, Rear Window. In the film, Jimmy Stewart’s character Jeff is wheelchair bound and bored, so he spies on his neighbors.
James Stewart observes Raymond Burr through the camera in Alfred Hitchcock’s “Rear Window” (1954).
Photo. BPA2 # 3712
But what starts out as a pastime becomes scary when he thinks something nefarious is happening. His friend, the policeman, doesn’t believe him and asks him to ask: “You mean to say that you can explain everything that happened over there and is still going on?” The lieutenant replies: “No, and so do you Not.”
One of the common themes of the film is that things are often not what they seem – you can’t explain everything. This also applies to taxes. For any tax law or rule that appears to be regulated, an argument must be made. That may be why so many of us like the tax profession so much: it’s the opportunity to look at a problem from scratch.
This week I’ve combined some of my favorite Hitchcock films with topics we encounter in the tax world, complete with expert analysis from our tax experts.
Quick Numbers Trivia
Hitchcock is credited with directing 53 feature films during his career. What decade is most attributed to it?
(Answer is at the bottom.)
Our summary
Even if we cannot always explain everything, we can rely on laws, statutes and experts to provide good arguments. From fee collection to digital tax solutions, here’s what our tax experts are talking about this week.
At the height of “Vertigo”, Jimmy Stewart’s Scottie faces his fear of heights and learns that being assertive doesn’t always pay off. In New Accounting Method Rules are no Cause to Celebration for Cannabis Taxpayers, Kat Allen of Wykowski Law in San Francisco advises caution when dealing with federal tax law, Section 280E. She warns that recent arguments that companies pursuing a tax-aggressive strategy could ultimately suffer damage.
Film director and writer Alfred Hitchcock is shooting “The Man Who Knew Too Much,” a Paramount remake of his 1934 spy thriller.
Photo by Baron / Hulton Archive / Getty Images
Timing plays an important role in The Man Who Knew Too Much, a subject we know all too well in the tax world. In New York Slice: Executive Orders create ongoing confusion over administrative tax complaints. Michael Hilkin and Jeremy Gove from Eversheds take a look at toll deadlines. The matter? New York Governor Andrew Cuomo (D) issued a number of executive orders in 2020, but there is confusion about whether the executive orders apply to filing administrative tax complaints.
In “North by Northwest” an innocent man is persecuted nationwide for mistake. It’s a subject Hitchcock likes to use in his films, and while such mix-ups can make a compelling story, it doesn’t always end well. Former Pennsylvania state senator Vincent J. Fumo found this out when trying to convince the tax court that they did not have the right man, arguing that he should not be subject to excise tax as he does not have a formal position at the charity. As Richard L. Fox of Buchanan Ingersoll & Rooney explains in his post, Former Pennsylvania Senator Subject to Excise Tax on Abused Charity Funds, the U.S. Treasury Court disagreed.
In one of the most famous scenes in To Catch A Thief, Grace Kelly’s character wears a fake diamond necklace – a fact that Cary Grant’s Robie immediately picks up on. Proving authenticity is not always that easy. A near unbreakable chain of ownership can help, which is one reason why non-fungible tokens (NFTs) are gaining popularity. The related questions, including rating, will be important considerations for future charitable giving from NFTs, explains Russell Willis of Charitable Solutions LLC in A Magical Action for Naught: Nonfungible Tokens.
In “suspicion” Joan Fontaine does not trust her new husband. He’s trying a little too hard to be someone he isn’t – but is he also a danger? Identifying your risk is crucial and one of the main purposes of DAC6 is to enable EU Member States to respond promptly to harmful tax practices. In Transfer Pricing and DAC6 – Going Beyond the Dedicated Hallmarks, Xavier Daluzeau, Céline Pasquier and Delphine Groux from CMS Francis Lefebvre Avocats discuss the DAC6 provisions that deal directly or incidentally with transfer pricing problems.
The audience knows the crucial details of the bomb Stevie carries with him in “Sabotage” as he sets off across London, even if he doesn’t. This is what makes the film so captivating when it meanders through the streets and encounters one obstacle after another: What happens in the end? Much of the tax world sees the path to a global tax solution in a similar way. In Consensus and Pillar One – An Indian Perspective, Ipsita Agarwalla and Meyyappan Nagappan of Nishith Desai Associates discuss recent attempts to find a consensus-based solution to digital taxation with an eye to the Indian context and perspective and potential impact on developing countries like India. On the US side, Andrew O’Brien-Penney and Tamara Levin recently co-authored a special report with other members of Baker McKenzie’s global tax practice. You can watch extracts from A Brave New World: Transfer Pricing for Digital Transformation, then listen on the Taxgirl podcast as they discuss the report and their experiences advising multinational corporations in Transfer Pricing: Digital Transformations and Transparency.
Write for us
Image taken in May 1972 of British film director Alfred Hitchcock (1899-1980) posing on a boat in Cannes ahead of the International Film Festival.
Photo AFP via Getty Images
Bloomberg Tax Insights articles are written by tax professionals and provide expert analysis of current tax practice and policy issues, tax trends and issues, and the practice and management of tax and accounting firms. If you have an interesting, unpublished article to publish, we’d love to hear about it. You can contact our Insights team by email at TaxInsights@bloombergindustry.com.
Beyond taxes
From “Rope” to “Spellbound”, Hitchcock was a master of illusion. But in real life, that’s not always a good thing. In the legal world, the opening of the legal practice and office property to “paraprofessionals” – also from investors – is promoted in order to improve access to justice. However, California attorney Genie Harrison, president of the Los Angeles Consumer Attorneys Association, says this concept is not data backed. In Paraprofessionals Will Fix the Access to Justice Problem, she says that such a move will seriously undermine the integrity of the legal profession.
Headlights
This week’s focus is on tax whistleblower attorney Randall Fox. Fox is a partner at Kirby McInerney law firm, where he represents tax whistleblowers. Fox previously served as the founding director of the New York Attorney General’s Taxpayer Protection Bureau, where he handled and monitored cases under the state’s newly enacted New York tax whistleblower provision under the state’s False Claims Act. The law provides financial incentives for whistleblowers to file lawsuits against individuals who have committed fraud against the government.
Student writing competition
Think you have what it takes to write Bloomberg Tax Insights? We’re excited about our first Bloomberg Tax Insights writing competition designed to highlight the best in student writing. Due to a large number of new submissions, our deadline has been extended to June 30, 2021.
Run with us
Ready to blow off some steam after a long (long) tax season? Bloomberg Tax challenges you to a virtual 5000. Run as fast as you want – or take a walk to take in the fresh air – and earn a cool medal. And since #TaxTwitter loves their waffles, pancakes and other breakfast foods, we keep paying it by donating the proceeds to World Central Kitchen to fight hunger. Here you can sign up.
Quick number answer
British actor Robert Donat (right) in “The 39 Steps”, directed by Alfred Hitchcock and produced by Gaumont International.
Photo by Hulton Archive via Getty Images
Hitchcock is credited with directing 13 feature films in the 1930s, including “The 39 Steps,” which is considered one of his best.
Exclusive content for Bloomberg Tax subscribers
On May 28, 2021, the Treasury Department published its first “Greenbook” since it was published in 2016 for the 2017 fiscal year. The Greenbook contains much-anticipated details on President Biden’s tax policy proposals. You can find a summary of the Greenbook in our BTAX OnPoint here.
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More great tax content
This is a practitioner-authored weekend round-up from Bloomberg Tax Insights that includes expert analysis of current tax practice and policy issues. For a full archive of articles, see Daily Tax Report, Daily Tax Report: State, Daily Tax Report: International, Transfer Pricing Report, and Financial Accounting.
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