Breaking News
Just in time for US Independence Day, there is a a major 
blow for IGAs and perhaps for FATCA itself.
James Jatras at repealfatca.com is reporting It’s Official: There Will Be No American Reciprocity
In a letter to U.S. Treasury Secretary Jack Lew, Congressman Bill Posey (R-Florida 8th), a key member of the House Financial Services Committee, has turned thumbs down on Treasury’s public claims that the U.S. will impose on American domestic financial institutions the “equivalent” of FATCA’s ruinous reporting requirements on foreign financial institutions (FFIs). It’s now clear that is not going to happen.
We’ve known for ages Americans would never agree to real reciprocity. Congressman Posey now seems to confirm that. Given the anger in Europe over NSA, this is just going to add fuel to the fire. It could also give Canada every reason to walk away from whatever is happening with those IGA negotiations.
Congressman Posey says:
“Given the evidence above, it is difficult to conceive of any circumstance that would justify imposing such an expensive and counterproductive domestic mandate.”
James Jatras says:
It needs to be understood that this is a denial that will stick…Thus, by sounding the death knell for reciprocal authority, Congressman Posey is sinking the IGAs, and in turn FATCA itself.
Here’s what Posey himself wrote:
“Further delay in FATCA enforcement and a moratorium on negotiating and signing additional IGAs is in order,” pending “substantial modification or, more likely, outright repeal.”
Congressman Posey further suggests Treasury does not have the authority to negotiate IGA and suggests
A cooperative scheme to penalizing tax evasion without harming the innocent.
We’re not free yet, but I hope this will be a great step on the road to freedom.
Happy Independence Day everyone!
This is ground-breaking, Blaze. Thanks for the heads-up. I have posted at Isaac Brock http://isaacbrocksociety.ca/2013/07/03/breaking-news-for-your-4th-of-july-celebrations/ and made a reference to it in a comment to http://www.theglobeandmail.com/news/politics/canadas-information-sharing-deal-with-us-under-fire/article12913617/comments/ at the Globe and Mail.
I also put a link to James Jatras speaking at the Toronto forum. In hindsight, it is worth another listen.
How foolish are all the other countries of the world to, as James Jatras says, capitulate to the threats of the US.
Thanks once again.
I have been out all day, and was reading comments over at the G&M and noticed this “breaking news”. Thanks for getting it posted for tweeting and commenting. Now lets see if Jack Lew is as good as stonewalling Congress as the other guy.
Here we go. Nigel Green is recommending British MPs reject IGA after it has been revealed that American authorities are unlikely to honour the deal’s fundamental reciprocity clause.
http://www.economicvoice.com/mps-urged-to-reject-contentious-tax-pact-with-the-us/50038181#ixzz2Y4yazRCL
Despite this great development, why do I think US Department of Treasury will not just meekly roll over and go away on this?
In any case, we need to remain vigilant. I have sent Congressman Posey’s letter to Jim Flaherty and Kevin Shoom.
Here’s an article from Accounting Today on Congressman Posey’s letter.
http://www.accountingtoday.com/news/Congressman-Calls-FATCA-Moratorium-67342-1.html
The grumpy part of me which has been living under the FATCA cloud for so long, just wants to say, ‘it’s about freaking time someone speaks the truth, that the US won’t/doesn’t honour their agreements, so why are countries entering into IGAs anyway?’, but in honour of the Calgary Stampede (which is happening despite the recent flooding devastation), I will just say,
‘Yippee! Yahoo!’ and throw my metaphorical cowboy hat in the air.
Great to have you back safe and dry, Outraged.
Ride, em Cowgirl! We need to Stampede all over FATCA.
And, now Toronto. Stay safe and dry. The best from southern Alberta.
In addition to floods in Alberta and less severe ones in Toronto, there was Saturday’s horrific train derailment and explosion in Lac Megantic Quebec.
I’m not sure I will ever feel comfortable using the train derailment analogy again.
Thoughts and prayers to all of those affected.
Center for Freedom and Prosperity has issued a press release in support of Congressman Posey’s letter.
http://freedomandprosperity.org/2013/press-releases/coalition-for-tax-competition-urges-support-for-fatca-repeal-bill/
Hi Blaze,
The link doesn’t appear to be working.
WhiteKat: Thanks for letting me know.
I think there is a problem with their website. Just Me got the same error message (404) earlier today. Then, I had no problem. When I noticed you could not connect with the link, I tried again and had the same problem.
In fact, now I can’t even access anything on Center for Freedom and Prosperity’s website. It likely is a problem at their end. However, here is a cut and paste that I did of the content from an e-mail I received earlier today.
Congressman Posey Rebukes Secretary Lew On FATCA
(Washington, D.C., Monday, July 8, 2013) The Center for Freedom and Prosperity announces its support for Congressman Bill Posey’s (R-FL) recent letter challenging Treasury Secretary Lew regarding implementation of the Foreign Account Tax Compliance Act (FATCA). In the letter Rep. Posey, a member of the House Financial Services Committee, expressed his deep concerns with regard to efforts of the Treasury Department to burden American banks with unauthorized and costly reporting requirements, and called for Treasury to halt implementation until the administration’s request for additional authority can be vetted by Congress. The letter, along with recent legislation introduced by Sen. Rand Paul to repeal FATCA (S. 887), provides further proof that Congress does not support the Treasury Department’s overreach.
Rep. Posey’s letter highlights Treasury’s pursuit of “intergovernmental agreements” (IGAs) which are committing the US to policies never authorized by Congress, such as requirements that domestic institutions collect and report information on nonresident aliens. Noting that the IGAs are not being submitted to the Senate for its advice and consent, Rep. Posey challenged the Secretary to cite the specific statute authorizing pursuit of IGAs.
Rep. Posey concludes, as did a coalition of taxpayer protection and free market groups, that FATCA is fatally flawed. The Congressman recommends that FATCA be “substantially amended or repealed, and replaced with a cooperative scheme that penalizes actual tax evasion without harming the innocent,” and calls on Treasury to institute of moratorium on both FATCA enforcement and the negotiation of IGAs until the Financial Services Committee can review that administration’s request for enhanced authority.
CF&P President Andrew Quinlan commented, “Despite significant evidence that its single-minded pursuit of FATCA enforcement has upended the international financial sector, strained relations with our neighbors, and threatened the stability of the US economy all in exchange for a penance of additional revenue, the Treasury Department has refused to budge.” He concluded, “We agree with Representative Posey that it is time for Congress to correct its grievously mistaken decision to eliminate the right to privacy for millions of innocent Americans while saddling the world with the costs of FATCA.”
Text of Congressman Posey’s letter:
http://freedomandprosperity.org/files/fatca/07-2013_PoseyFATCAltrLew.pdf
For more information on FATCA visit CF&P’s dedicated web page:
http://freedomandprosperity.org/issues/foreign-account-tax-compliance-act/
For additional information:
Andrew Quinlan, President, can be reached at 202-285-0244, andy@freedomandprosperity.org
Brian Garst, Director of Government Affairs, can be reached at bgarst@freedomandprosperity.org
###
Link to Press Release: http://freedomandprosperity.org/2013/press-releases/congressman-posey-rebukes-secretary-lew-on-fatca
I hope their website will be available again soon. In the meantime, this is the content from that news release.
This was good news, wasn’t it? I’m not ready to say that it’s a FATCA killer but it sure might slow them down.
I’m eagerly waiting for the French to state their position. I suspect it will be similar to Germany’s – some sort of reciprocity and “we’ll start sharing when you start sharing.”
@Victoria: We all know how likely the US is to “share,” don’t we?
Congressman Posey’s letter at least indicates FATCA may have a bumpy ride ahead.
I hope France, Canada and other countries will finally see this for what it is and say no.