Congress to introduce Foreign Washing Machine Compliance Act (FWMCA) to fight offshore abuse of Tide Detergent


Every now and then, we all need a good laugh. Instead of posting a mind-boggling account of the never-ending misery of being a U.S. expat abroad, here is something completely different. Enjoy!

reposted from Isaac Brock Society
Posted on March 13, 2012 by Eric


Recently, reports have surfaced that drug dealers are abandoning the U.S. dollar in favour of a cleaner, more liquid medium of exchange.

Tide has become a form of currency on the streets. The retail price is steadily high — roughly $10 to $20 a bottle — and it’s a staple in households across socioeconomic classes. Tide can go for $5 to $10 a bottle on the black market, authorities say. Enterprising laundry soap peddlers even resell bottles to stores. “There’s no serial numbers and it’s impossible to track,” said Detective Larry Patterson of the Somerset, Ky., Police Department, where authorities have seen a huge spike in Tide theft. “It’s the item to steal.” …

The report goes on to note the uses of this nefarious new currency:

[L]aw enforcement officials across the country say Tide theft is connected to the drug trade. In fact, a recent drug sting turned up more Tide than cocaine … “They’ll do it right in front of a cop car — buying heroin or methamphetamine with Tide,” said Detective Rick Blake of the Gresham Police Department. “We would see people walking down the road with six, seven bottles of Tide. They were so blatant about it.”

Tide Detergent is known to be used in a number of tax havens in the Caribbean, Europe, and Asia. More worryingly, it may be used not just in the drugs trade, but for washing items of clothing — including clothing purchased with the proceeds of tax evasion.

Fortunately, Americans can rest assured that their government is not standing idly by in the face of this threat. In order to combat the scourge of garment-and-money laundering, Carl Levin and Charles Grassley have introduced the new bipartisan Foreign Washing Machine Compliance Act (FWMCA). All U.S. Persons who use more than 50,000 milligrams of laundry detergent, softener, or bleach per year in a Foreign Laundering Device (FLD) such as a washing machine, dryer, or combined washer-dryer will be required to file the new Form 9876, “Report of Certain Foreign Laundering Activities” with the IRS. The form requires taxpayers to list such essential information as the brand and serial number of the FLD, the number of wearable laundered items (WLIs), the date each WLI was purchased, its fair value in US dollars on the date of purchase, and the number of times it has been worn. Regulations will be issued to specify what types of WLIs must be included on the form. Furthermore, Foreign Laundromat Entities (FLEs) will be required to search their records in order to find all U.S. Persons who use their facilities.

“FWMCA will not only give our government the tools to fight illegal laundering, but will ensure that all Americans pay their fair share of sales tax on their purchases of detergent and foreign clothing”, stated Levin. GAO projections suggest that the new law will raise an even greater amount of money than December’s Kitty of Foreign Origin Report, which netted $4.4 billion from Americans who were concealing offshore felines. In response to misinformed complaints from non-resident non-aliens that the FWMCA would criminalise the ordinary wearing of clothes in foreign countries, Levin and Grassley pointed out that U.S. Persons in foreign countries had a significantly higher threshold of 200,000 milligrams of detergent per year. Grassley further noted that U.S. tax laws already provide significant subsidies to expatriates who do laundry in foreign countries, despite the complete lack of benefit such activities provide to the U.S. economy.

American commentators spoke out strongly in support of the law, but note that it does little to close the hand-washing and air-drying loopholes, which could enable tax evaders to keep their clothes clean without the knowledge of the IRS. Levin promised that his office would look into the problem and possibly introduce subsequent legislation to require reporting of other laundering paraphernalia such as basins, water, and clothes-hangers. An Isaac Brock Society spokesperson with a suspiciously unstained white shirt refused comment for this story.