Sutherland’s Jack Trachtenberg Interview with Bloomberg on Tax Whistleblower Laws

Click here to watch the interview on YouTube.

In the interview, Sutherland state and local tax attorney, Jack Trachtenberg, explains that tax whistleblower laws (aka False Claims Act) allow  individuals or the state attorney general to bring suit on behalf of the state for unpaid taxes in exchange for a portion of the recovery.  Some states even permit the recovery of treble damages for such lawsuits.  Trachtenberg noted that some state whistleblower laws create Catch 22 situations for sales tax collection: on the one hand, companies may decide to over collect sales tax in an abundance of caution to guard against an attorney general suit but, on the other hand, may also be subject to a lawsuit by customers for that same over collection.

Hawaii legislators considered and shot down a tax whistleblower law (S.B. 2947) during the 2012 session that was modeled after the federal whistleblower law.

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