Tag Archives: privacy

Solving US Citizenship Problems -Toronto, July 19

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Life planning, Career planning and the Reality of U.S. Citizenship for Americans Abroad including Life Preparation for U.S.Citizen-children of U.S.Citizens
 
These seminars will include discussion and analysis of the IRS “relaxed opportunities” for people to come into compliance.
 

It is estimated there are 7 million U.S. citizens living outside the United States. Some of these people don’t know that the U.S. may consider them to be citizens. The vast majority of these Americans abroad (according to U.S. law), are required to file tax returns and complete information reporting forms to the United States. Although “citizenship-based” taxation has existed for years, what is new is the enforcement.

Continue reading Solving US Citizenship Problems -Toronto, July 19 →

Will Canada's Privacy Commissioner Finally Speak on #FATCA?

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Why has Canada’s Privacy Commissioner been quiet on #FATCA since the IGA was signed?
Her office has ignored four e-mails I sent.  Is she about to break her silence?
Chantal Bernier is scheduled to testify before Senate on Tuesday May 13 at 9:30 am.  I’m not available then. Can anyone record it and post it here?  (There always seems to be a problem with the video from Senate hearings afterwards that we don’t have with House of Commons meetings).
Thanks Tim for alerting me to this.

#FATCA and Erosion of Privacy (Cockfield)

FATCA,

Queen’s University Professor Arthur Cockfield’s provided a comprehemsive report to the Privacy Commissioner in April on FATCA and the Erosion  of Canadian Taxpayer Privacy.

In his 36 page report, Professor Cockfield reviews numerous laws, practices and policies. He says:

FATCA and the IGA unduly harm the privacy interests and rights of Canadians in part because detailed financial information concerning hundreds of thousands of Canadians would be transferred to a foreign government for the first time…The Canadian government should not implement the IGA until these privacy concerns are addressed.

Professor Cockfield looks at various laws and practices. He briefly addresses some Charter issues:

The  IGA may violate section 15 of the  Charter that prohibits discrimination  on  the  grounds  of  national  origin  (including  citizenship).  As  discussed  in  this report,  the  IGA  discriminates  against  US  citizens  (and  others)  residing  in  Canada  by  offering  unequal  treatment  of  these  individuals  (see  Part  VI.G.).    A  criminal  investigation  calls  for constitutional law protections afforded by the  Charter of Rights and Freedoms including section 8, which restricts unreasonable searches and seizures.75 A demand for tax information may also  violate an individual’s right to remain silent under section 7 of the Charter.76 If the United States.
 

Professor Cockfield concludes:

Accordingly,  the  IGA  and  the  Implementing  Act  do  not  protect  the  privacy  rights  and interests of Canadians. Bill C-31, the proposed law to implement FATCA  that at this writing is before Parliament, needs to be amended to account for these privacy concerns. Until the privacy and  other  concerns  are  studied  and  addressed  by  Canadian  lawmakers,Canada  should  only  transfer FATCA required data associated with U.S. persons who are not Canadian residents. This approach   accords   with   longstanding   practice   and   emerging   global   information   exchange standards. The government should take immediate steps to ensure this standard is codified in Bill C-31.  This  move  would  safeguard  the  privacy  rights  of  Canadians  while  enabling  Canada  to work  cooperatively  on  a  global  scale  to  ensure  that  tax  evaders—American,  Canadian,  or otherwise—do not have a safe haven anywhere.

Professor Cockfield is on the panel with me next week, along with a Candian-American tax lawyer based in New York.
Many thanks to Badger for this great find.  I did a quick speed read. If Badger would like to do one of her thorough and thoughtful analyses, that would be greatly welcome.
 
 

How The U.S. Pulled Off The Great Canadian Privacy Giveawa

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By Arthur Cockfield and Allison Christians in today`s Globe and Mail: How the U.S. Pulled Off the Great Canadian Privacy Giveaway.

For the first time in Canadian history, our federal government is preparing to provide a foreign government with sensitive personal financial information about hundreds of thousands of Canadians. It is doing so to stave off threatened economic sanctions, and is getting nothing in return.

Their article tells the “`sad saga“ of how the US managed to pull it off and makes a suggestion for an amendment to the enabling law that would allow reporting only on U.S. residents.
 

Privacy Isn't All We're Losing

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Privacy Isn’t All We’re Losing by Peggy Noonan in Wall Street Journal is one of the best I have read on the NSA issue.  Much of what she says can be  Liberty Sad Samapplied to FATCA, IRS, FBAR, OVDI, etc.

If—again, if—what Mr. Snowden says is substantially true, the surveillance state will in time encourage an air of subtle oppression, and encourage too a sense of paranoia that may in time—not next week, but in time, as the years unfold—loosen and disrupt the ties the people of America feel to our country.

Americans and former Americans living outside US have already experienced that. Many of us now feel only animosity.
Peggy Noonan wonders what can be done

So what’s needed? We must realize this is a crucial moment: We either go forward with these programs now or we stop, and think.

Unfortunately, US seems to have lost the ability to stop and think. We have been repeatedly told that the FATCA train has left the  station.  If it doesn’t derail, there will be more and more passengers jump off the citizenship train as soon as they can. Many of us who left the citizenship train years or decades ago are not about to get back on it–not even for visits.

How did we get here? You know.

 
 
 
 
 

FATCA Fact Finding Forum Report – Part III

Citizenship, FATCA, Taxes, , , , , , , , , ,

FATCA Fact Finding Forum Report Part III
We took a break after Professor Christians’ presentation and began again with a brief talk by Anglican Archbishop Dorian Baxter who is the President of the Progressive Canadian Party. He related a very funny story of a conversation with an older member of his congregation who lamented that we no longer had Steve Jobs, nor Johnny Cash or Bob Hope. They talked a bit about this and then applied to current state of Canada – we have no jobs, no cash and no hope!
He emphasized that we need to hold the CDN govt accountable to the standard of the Westminster model of Parliamentary Democracy. This relates to a core principle of the Progressive Canadian Party and the illegal “merger” of the Canadian Alliance Reform Party (aka “CRAP”). This provoked much laughter. Then he applied the Westminster ideal to the fact that FATCA is an invasion of CDN Autonomy as well as the Canadian Treasury as it is a money grab of millions of dollars from Canadian families, their children and their children’s children.
Next we heard from James Jatras who had travelled all the way from Washington to be with us. He has a completely different approach than what is commonly being expressed, even by Brockers. We all speak of FATCA as if it will happen; “resistance is futile.” He feels there is very much that can be done to defeat FATCA.
*FATCA is not equivalent to NAFTA, WTO, etc. Most Homelanders are completely unaware of it. Including a high-level aide to a Senate Finance Committee
*FATCA amounts to a UNILATERAL, extra-territorial law which says if you don’t obey us, we will punish you with sanctions.
*Instead of an IGA, Canada should pass a tax treaty override; what we have now is the CDN govt and the FFI’s collaborating against CDN citizens.
*US: “we are generously allowing you to change your law.” This is no partnership.
*Article 2 of the IGA “foreign partner; subsection A is unequal to subsection B and Art 6 US will “eventually” adapt to partner level  This will never happen.
*like a preemptive war where one commits suicide to avoid death
*China will not; expects Brazil will not; Russia?  It is CRUCIAL that Canada say “NO” This will set the stage for others to do the same. Powerful influence since we are such a major partner of the US, if we can do it, so can others
“Never seen such a bad law similar to the Catastrophic Recovery Act of 1989 or the Dubai Ports Law, which were repealed
*FATCA stands to cost the world $1 trillion dollars what with the tax lawyers, accountants and the IT depts. required to make it work
*CBA letter to US Treasury – take 1% of the money spending to implement FATCA and use instead, to repeal FATCA
*We need $50k – $100k a month for 12 months in order to deal with repealing FATCA; ads in “Roll Call; etc, you can’t just ask Congress to do something, there’s a process
*EXTORT EMBARRASSING DETAILS/ MAKE AN ORGANIZED EFFORT
*Treasury is in a rush to get IGA’s signed before the repeal forces rise up
*Where on earth are the CDN media, the NDP, the Lib Party, the Conservative Party –(just at this point, Mr Gullon mentions a newcomer is a member of the Green Party)
*FATCA = a US Discriminatory Trade Infraction
*Canada: We will hit you with law suits, trade actions, etc. Legislation after FATCA-we will withhold 30% of all income of Americans in Canada; ask our PFFI’s to collect waivers, etc
*Seek out those spending millions now and get a tiny portion of that towards PR to repeal
*Discussion of who has signed – UK, Denmark, Ireland, Mexico, Switzerland; UK has to clear Parliament; the Honorable Sinclair Stevens suggested that we emphasize any aspect that UK has yet to clear – this could have an impact on Canada. Not sure it was clear why – i.e., an American might not understand the Canadian attitude toward England in parliamentary matters.
*Are the IGA’s “Executive Agreements?” or “Competent Authority Agreements?”  Is Treasury overstepping by not getting Congress to approve IGA’s? Treasury says they have to promulgate regulations and that they have the legal authority to do so. Do they?
*UK-signed Sept 12, 2012. They still have to implement the legislation allowing for FATCA and now, son of FATCA
*There are those who make things happen, those who watch things happen and those who ask “what happened?”  We need to be of the first category.
*You must require the government to JUSTIFY why they are doing this
*Bring back 2003 when PM Chretien said NO to attacking in Iraq; very  similar to the “coalition of the willing”  notice again, the UK is the first to sign on
*Recapture and recreate the 2003 movement
*The Green Party representative, Erik (sp?) Jacob Hawkins is a Critic in the Shadow  Cabinet, is from Barrie and works directly with Elizabeth May; Parliament recessed; however, with a petition with at least 25 signatures, a member can force Parliament to examine an issue. The Honorable Sinclair Stevens, Prof. Allison Christians and Jon Richardson immediately drafted a petition which we all signed to present ASAP and hope no IGA is signed before Parliament resumes in January.
*There should be bilateral agreements without any bizarre sanctions
*Banks themselves should have reasons to instigate movement against FATCA; likely banks have pressured Flaherty who clearly did not like, did not agree with and did not want FATCA
*Discussion of possible actions in near future re: Op Ed’s, etc. (more on this later and please don’t ask for now)
At this point, Petros asked me to drive Prof. Christians to the airport to catch her plane so I left and do not know what happened after this point though Jon Richardson mentioned there would be several more speakers after the break and Petros had prepared something, so hopefully, he will have more to report and was able to deliver his comments.
********
Generally, the audience composed of about 5 members of the Prog. Canadian Party including previously named speakers; Abby Desham, Allison Christians, James Jatras, Petros, Deckhard and myself (I don’t know if there were other Brockers) and the rest were duals with their non-US partners. I spoke to a lady who said she was an Accidental remaining in “full ostrich;” she has been following since ExpatForum and reads IBS. The lady sitting next to her had to go but also came due to Brock.  I spoke to a couple and a man who said Peggy Nash had told him about the meeting; another set of 3 who knew via Brock and 2 more who also knew via Brock. One fellow was conversant with many concepts but I did not get a chance to speak with him. At least 11 attendees were not Brockers or speakers or Party members
****
Beginning list of possible catch-phrases/ideas to promote:
Tax Treaty Override /  US will not honor treaties / futility of reciprocity /US is doing something OTHER than citizenship-based taxation / War of 2012-War of 1812 idea) / violating Autonomy, violating privacy/ Bullying – not on the playground, not here either / Sanctions against Canada / A REAL FRIEND SAYS ‘NO’
 

FATCA Fact Finding Forum Report – Part II

Citizenship, FATCA, IRS, Taxes, , , , , , , , , , ,

Part II
We then started with this video:
http://www.youtube.com/watch?v=3Q9QoHXt6I4
The emphasis on how bizarrely the indicia rules could be interpreted began to be a framework of the discussion.
We then heard from Professor Allison Christians. She studied tax law in the US and has an LLM from New York City University. Point was made that this university has some sort of monopoly on producing international tax lawyers.
*At first, FATCA seemed like a reasonable proposal to deal with tax evasion as the US, along with other major European countries, were experiencing a disappearing tax base with the upper tier of taxpapers escaping their obligations.
*10 years ago, OECD began to promote state-to-state cooperation, which again, seemed a “reasonable” reaction to this situation
**Govts don’t want to hit the middle class “coming and going;” i.e., taxing them on their income and then taxing them again on what they spend on consumption. VAT-GST-HST, etc. The upper tier evades and the lower tier has nothing to pay.
* Law pulls everything into it’s lane – i.e., not just the top tier/tax evaders but also everything “foreign”
*PFFI has two choices:
1) seek waivers which results in giving whatever info the bank asks with consent to disclose to the IRS OR
2) close the accounts
*Important to note – this is NOT a CLOSED agreement; the IRS/US has carte blanche to ask WHATEVER  they want WHENEVER they want (later)
*A recalcitrant PFFI will have 30% withholding on it’s US source cash flow; interest, dividends and property; property worth $1000 sold for a loss at $800; however, FATCA will withhold 30% of that $800.
*at all levels/pass-through-pmts i.e., not just the PFFI of the US Person but the FFI that sends to the PFFI, etc.  Building in a withholding succession.
*The “get out of jail free card” is the IGA
*packaged as information exchange, the current Treaty already covers this; we have low financial privacy with regard to CRA who also has restrictions with what it can and cannot do with our information; we should have a HIGHER right with respect to a 3rd party
*with US and Mexico already having IGA, 2/3 NAFTA is already signed on and danger of Canada being swept in
*We MUST recognize/emphasize that FATCA is INCONSISTENT with our domestic law
*It violates Canadian Autonomy (as opposed to sovereignty); sovereignty is a problematic, binary concept, law of contestation.   Use AUTONOMY instead
*it violates a USC’s mobility
*Canadian citizens are not given a choice since the FFI’s have already chosen for us
*THIS IS EXTREMELY IMPORTANT-just like in litigation, the goal is not necessarily to win; we must do what we need to do to ‘WIN THE PUBLIC RHETORIC”  i.e., get attention in the PUBLIC COURT
*Revenue Code – can elect to be treated as a US company (or taxpayer); parity
*there is no parity between a dual in Canada and a dual in the US
*Case studies where a statute may look facially neutral but challenged by “intl” law
*?  USC violated via Constitution with restriction on leaving?
*who is already over-reacting to IRC-US conservatives
*4 things we can do
1) FATCA = a US treaty override
     similar to 1986 Branch Profits Tax
“later in time law”  concessions where legislation will trump Treaty
2) doing it now with FATCA statute; PFFI has to waive any rights under ANY Treaty;  ex subsidy claim under WTO or NAFTA or FTAA; not just the double-tax treaty
*an attempt to get USC’s abroad to relocate
*an IGA acknowledges the need to waive rights under all treaties; no competent govt would agree to such; FATCA does override the double-tax treaty
*YOU DON’T HAVE TO WIN YOU JUST HAVE TO MAKE IT EXPENSIVE AND GET PUBLIC AWARENESS  (ex the reciprocity issue)
2) Possible violation via NAFTA (but trumped by IGA?)
3)   NB  US has at least 20 FTA’s which amount to defacto subsidies for US institutions
4) International law – customary laws being violated; a sovereign nation has the right to regulate in it’s territory and the power to protect the privacy of it’s own people
*Avoid use of the term citizenship-based taxation; all countries do this with tie-breakers in their treaties; point out US is doing something OTHER than citizenship taxation
*re-think the charade of cooperation; Canada gets nothing, the PFFI gets nothing; pure extraction, no quid pro quo
*under no circumstances should Canada sign an IGA; PFFI challenge any bank signing away their rights who then, sign away yours
*there will be an ongoing cost to saying “NO”
*problem with arguing FATCA  violates NAFTA is treaty override-SAY IT IS and DEMAND the government (Canada) to say IT’S NOT
IT IS a tax treaty override and it IS a privacy override-which are we to give up?
*discussion of 6 indicia and truly bizarre ways in which can be interpreted (too long to go into here but Allison did a superb job of showing these, which will be on the video)
 

FATCA Potentially Hazardous

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We have discussed here and at Brock much of what is in Now Lebanon’s article FATCA’s Security Problem.  I think this is the first article I have seen with it all in one piece.
The author Michael Young is the opinion editor for The Daily Star in Lebanon. He certainly “gets” FATCA.  I wonder if he is a “US person” there.
He writes of the privacy issues for American citizens and spouses, “abusive”  burden on financial institutions and difficulties in accessing banking in some countries.
Mr. Young says FATCA is “a case of America throwing its global weight around.”  Plus:

The civil liberties implications are profoundly disturbing.

Mr. Young calls one area of FATCA “potentially hazardous.”  FATCA is demanding FFIs become “vast repositories” of personal information on American citizens with no guidelines for security of this information.
For a country obsessed with the security of its citizens in the aftermath of the 9/11 attacks, such behavior is paradoxical, indeed astonishing.
Mr. Young is as perplexed as we are on Department of State silence on FATCA.
At a time when American embassies regularly issue advisories to citizens to guarantee their safety, we are seeing the IRS asking institutions abroad to gather the most sensitive facts on Americans, with no oversight. The irresponsibility is breathtaking.
Mr. Young says it is “no wonder Americans across the globe are outraged.

IRS would not dare replicate FATCA in the United States.

 

 

Canadian Government Seeks Input on FATCA

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The Canadian Ministry of Finance is Seeking Input on FATCA Negotiations From Canadians.
Between Brockers, Maple Sandboxers and many others, we have already provided an immense amount of input. But, they are asking for “additional comments.”  Let’s give it to them!  Soon! No deadline is given, but we can’t lose his opportunity.
I have (again!) contacted Canadian Civil Liberties Association and asked them what they will be doing on FATCA.   Eight weeks ago, CCLA told me they would advise me “tomorrow” what they might be able to do. They still have not done that.
If anyone else is interested in contacting CCLA, my contact has been Abby Deshman, Director of Pubic Safety. mail address: adeshman@ccla.org  Perhaps if Abby hears from others, she will realize how important this is.