Steven A. Dean (Brooklyn) has an op-ed in next week’s National Law Journal:  Extraterritorial Tax Information: End the Barter System:

The domestic limits of information reporting are a drop in the bucket compared to the holes in U.S. tax authorities’ ability to acquire information about the foreign activities and income of U.S. taxpayers. Determined tax cheats have capitalized on authorities’ inability to acquire extraterritorial tax information by hiding money in tax havens. The amount of tax revenue lost to schemes involving tax havens (about $50 billion per year by most counts) suggests a truly breathtaking iceberg may be lurking just out of sight. Even when taxpayers don’t go to great lengths to hide their income, the lack of extraterritorial tax information available to U.S. tax authorities leaves taxpayers with a big advantage that they simply do not have at home.

Improving access to extraterritorial tax information probably means abandoning the approach championed by the League of Nations 80 years ago that is still just about the only way that governments receive this information. The League’s barter system relies on the concept of reciprocal information exchange, which requires pairs of nations to reach agreement on the identical information that each will provide to the other. More than a half-century of reliance on this system has produced cross-border information exchanges that involve a vast amount of information about taxpayers that somehow manages to be essentially useless to authorities. As Mark Everson, then IRS commissioner, explained in 2006, the reports it receives "suffer from a number of deficiencies," including a lack of crucial detail (such as U.S. taxpayer identification numbers), and the fact that they are often "in a foreign language and involve foreign currency" and "are not timely."