UPDATE 2: This post has been upgraded to a press release at newswire.ca and digitjournal.com. Thanks go to Jim Jatras.
UPDATE: Jim Jatras has provided an revised Word Version of the text below for mass distribution.
The following is a message from Jim Jatras:
Friends
Please review that following and submit comments. I hope it’s more or less self-explanatory.
As indicated in a previous comment, it’s in effect a kind of ad or statement inviting people to contact Harper, Flaherty, MPs and oppose FATCA/IGA. Ideally, it’s the kind of thing that would be posted online or even in print publications as an ad, if there were money for that. (If Canadian industry weren’t spending money trying to get the “best deal possible” from the Americans under an IGA instead of fighting.) Certainly individual comment letters to the Finance Department should be sent, but let’s not kid ourselves they will pay much attention them. What we need is a groundswell of outraged Canadians to contact Harper, Flaherty, and MPs as soon as possible with a simple message: NO!
I realize that it’s always risky to hang a draft out where anyone can take a whack at it, but feel free. Also, any ideas on where and how it can be posted and distributed are welcome.
BTW, this is the kind of thing that routinely gets placed in DC in publications like Politico, The Hill, Roll Call, and other pubs aimed at Congress. Picture a similar message aimed at Congress but making an American argument against FATCA, as this makes a Canadian one. That’s how we get things done – if we had someone with money and willing to fight.
Best
Jim
Call or email Stephen Harper, Jim Flaherty, and Your MP Today!
Call or email Stephen Harper, Jim Flaherty, and Your MP Today!
STOP an Impending Massive Handover of Canadian Sovereignty to the United States!
Tell the Government: Canada Must Say NO
to the United States on ‘FATCA’
Recently the Department of Finance invited comments on what was characterized as “an agreement to improve cross-border tax compliance through . . . the provisions enacted by the United States commonly known as the Foreign Account Tax Compliance Act (FATCA).” This eleventh-hour invitation came as sources in both Ottawa and Washington announced that they were close to finalizing an intergovernmental agreement (IGA) that would, in effect, deputize the Canadian government to enforce this American law in Canada.
The Department’s invitation is to “persons whose interests are affected by the provisions of FATCA” but does not spell out that each and every Canadian citizen would suffer from FATCA and from an IGA to implement it:
Canadian citizens have an interest in preserving Canada’s sovereignty against US encroachment. However it is disguised, FATCA is a unilateral U.S. initiative. The U.S. didn’t negotiate a global tax scheme with Canada and other countries but instead enacted an unprecedented extraterritorial law and demands that Canada comply and bear the costs. An IGA simply puts a Canadian glove on the hand enforcing American law.
Canadian taxpayers have an interest in a tax policy that benefits Canada’s needs, not America’s. Sold under the guise of “reciprocity” and “partnership,” an IGA in reality would be a costly one-way street imposed by the U.S. Given the differences between the two countries’ tax systems, FATCA would accelerate a zero-sum game that siphons wealth from Canada and robs the Canadian treasury.
Canadian consumers have an interest in avoiding foreign schemes that impose costly non-economic regulations on Canadian firms (banks, insurance companies, pension funds, stock and investment companies) – who will then pass those costs on to consumers. With or without an IGA, FATCA’s costs will be in the billions of dollars (for example, one major bank alone would pay an estimated $100 million in FATCA compliance!) These costs would be non-productive as regards the Canadian economy and a waste of human and material resources. Imposing these costs on Canadians supposedly is justified by the unproven hope that FATCA may trip up American “tax cheats,” even though FATCA does little specifically to catch such people.
Canadians as human beings have an interest in ensuring their rights are protected under sovereign Canadian law. FATCA demands extraordinary disclosure of private information of U.S. citizens in Canada in violation of Canadian laws, such as the Personal Information Protection and Electronic Documents Act, whose application Canada would be forced to alter under an IGA. Many of these resident Americans are Canadian dual citizens who would be denied protection of Canada’s laws to appease the U.S. Once it’s established a foreign government can demand abrogation of such rights, even of Canadian citizens, where’s the limit?
So why is the Government considering an IGA with the United States? Because of the very real fear that Washington otherwise would unilaterally impose FATCA on Canada at ruinous cost, especially a 30% withholding penalty on Canadian firms’ U.S.-derived revenue. Simply put, this is a threat of U.S. economic sanctions against Canada.
Finance Minister Flaherty and industry leaders publicly have talked a good fight on FATCA while in private negotiating Canada’s capitulation under an IGA. Canadians must not let that happen! Instead:
Contact Prime Minister Harper and tell him No on FATCA, and No on an IGA with Washington!
Contact Minister Flaherty and tell him No on FATCA, and No on an IGA with Washington!
Contact your Senators and MPs and tell them No on FATCA, and No on an IGA with Washington!
Get the FATCA facts! Find more information at [Isaac Brock Society and Repeal FATCA]
@Em,@Calgary,@Bubblebustin, @MonaLisa and @ Lioness – I am, unfortunately, a member of this club, too. For OVDI, I had to send 8 years of documents from my country to the US, amounting to more than 8kgs, I have spent close to USD 1000. I filed a lot less forms than you have mentioned. My costs came about because there are no OVDI lawyers/accountants in my country so it was not possible to bring documents to a lawyer or an accountant for a consultation. There was a lot of sending documents back and forth, especially when it came to signing the returns. As I had a normal life abroad, there was lots of documentation to send in addition to bank account statements to justify everything on my returns. I doubt the OVDI creators expected their specially trained international enforcement agents to be looking at receipts for a toilet repair, but this was the level of much of the documentation that I was sending to my tax professionals.
Once the documents had been reviewed by the tax professionals in the US, the documents required by the IRS were then sent by the lawyer in the States to the IRS. I thought that expensive and time consuming process was over and that I would not have to do it again. I wrote it off as one time sunk costs. Ha!
I am trying to be stoic about the following, but it requires a bit of effort. I am aware that my case is being assigned now. The well meaning IRS agent who was trying to explain what was happening told me that it could be that some of my documents have been lost. My lawyer carefully documented everything he sent them and the agent told me that they are having issues in retrieving all binders listed as being in the boxes. I was told that I may be asked to resend some of the documents. I wish the agent had not tried to be helpful in this way. As I am still waiting to see what the reality is, I am trying to look at it dispassionately pending further information.
On top of that, most recently, because the IRS is not coordinated with OVDI and collections were started on a year which I had already paid more than 1 year ago, in addition to what was spent on OVDI mailings, I have spent about USD 90 on registration/certification for correspondence to stop the collections. It was good I registered all correspondence as this was extremely useful to me when I was asked to prove my attempts to stop the collections as well as the payment. USD 90 was cheaper than using a tax professional, however, the expense never should have been necessary.
Any kind of correspondence with the IRS will always be more expensive and time consuming for a US Person Abroad. Email correspondence could resolve some of this but, email is not allowed from abroad, nor within the US. This is ridiculous. Email is allowed with the tax authority in the country in which I reside and I am sure they have the same kinds of security concerns that the IRS does.
I understand that those who remain US persons will be required to file FBARs electronically in the future. If this is true, then US persons abroad should also be allowed to use a secure email for sending our correspondence to the IRS. It would resolve time and cost issues.
*@Lisa, I hear you but in a way don’t want to make things even easier for the IRS or chances are, we’ll just wind up with more audits abroad!!
@All, @Lisa.
Lisa, I don’t know what to say. Comprehension on reading of your experience would be unfathomable for so many other than those who are encountering the results of US citizenship-based taxation. The results of this same process to take place worldwide by all countries who want to enter into IGAs with the US is too huge for my brain to take in. The world has gone mad.
Lisa, have you been in contact with the Taxpayer Advocate SAMS http://www.irs.gov/uac/What-Is-Systemic-Advocacy%3F? I think you and any of us going through this should highlight these egregious unintended consequences. Unintended because no one who put these laws into force had the intelligence to do a cost:benefit:consequences analysis in the first place.
@Em,@Calgary,@Bubblebustin, @pacifica777, @nobledreamer
The conversation around photos of your submissions got me digging around my hard drive this morning. I recalled that I had taken a couple at the time of my 2009 OVDP submission
I don’t have a picture of everything, but I do have a picture of the bundle I created and mailed at a cost of $75 to my Examiner when going through the 2009 OVDP. My life was a little simpler than some, as my financial life in NZ was limited to passive income. I chose not to work, or invest in mutual funds, and that was only because I didn’t think the fees and the returns were worth it at the time.
This meager little pile of compliance crap must have taken me about 80 hours or longer to pull together to meet the demands of their “check list” . I should have stacked the yearly income tax files and back up next to it, as it would have more than doubled in size. And that is for a simple life of a “Tax Cheat”, not a complex one! 🙂
Maybe we could make a Thread called “Photos of Compliance” ! That might tell the story better than our words. Here is mine to add to that mix.
@Just Me,
Amazing. If there are more photos submitted, we should have a dedicated thread to help explain the LCU’s used up in the process of piling up this paperwork.
One, two, three:
Let’s all sing Em’s chorus loud and clear:
Perhaps the next time the US decides to condemn Eritrea, we should send them one of these photos with a photo of the Eritrean tax form for overseas citizens Eritrea’s whole tax package is one page!
(btw, Eritrea appears to be a 2% flat tax on net income)
Em @ bubblebustin
Did you ever find your “banker’s box” photo? I’ve done screenshots of calgary411’s and Just Me’s forms. I’d like at least one or two more to photoshop into a composite. If nobody objects I would use that as visual ammunition to attach to my e-mails to MPs and the like. I’ve also thought of doing an IRS/CRA form comparison photo to drive home the insanity of the USA’s FATCA fiasco and citizenship based taxation in general. Unfortunately, even with all the Brock education I’m not sure I would know exactly which forms would be required for a typical tax payer with more financial complications than I’ve had to deal with.
I wish I could do graphics because then I would do a globe with the head of a giant vampire IRS squid situated in the USA and its tentacles reaching out all over the world. The tentacles would be slamming banker’s boxes full of forms on prostrated victims, grabbing peoples’ savings, threatening others to fork up tax penalties and snatching babes with “Property of the USA” stamped on their foreheads away from their terrified parents. There would be US flags with OBEY emblazoned on them planted all over that globe. Is there a Brocker with the talent to put together such a graphic?
It has been probably been posted somewhere already, and I have not kept up with all the reading, but this from the Center for Freedom and Prosperity blog…
Author: Andrew QuinlanNovember 16, 2012
Can Treasury Con 50 Countries Into Relinquishing Their Fiscal Sovereignty?
@Em
I’ve taken another picture of the paper that was sent and will forward to Petros. I can’t ask my husband for the original as he still gets angry about the Fedex charge. It’s depressing to think about remembering almost a year ago how much stress we are under. Is this what PTSD feels like?
More FATCANATICs applauding the creation of GATCA Just in case there was any doubt what FATCA is about.
GFI Applauds Treasury for Work Expanding FATCA toward Automatic Tax Information Exchange
*all – I’ll try and get some photos of all my forms by tomorrow. I like the idea of having “photos of compliance” with a catchy headline. Maybe another press release?
Thanks bubblebustin. Is this what PTSD feels like? — Sigh, yes I think so. But one thing that can help is support and that’s what we all get here, isn’t it.
@ lioness
I like that idea too. Then if anyone wonders what compliance (creepy term that is) looks like we can all say THIS (insert photo) is what compliance looks like.
*calgary 411 just sent off my issue to TAS – SAM. thanks for the
info.
@lionness, lioness, Just Me
utterly horrible. good gawd, is there anything they didn’t ask for?
I filed my 2011 fbar electronically. Only because I waited until the nite before.
I did a search of any articles relating to FATCA, OVDI and citizenship based taxation on the “Truthdig” web site. Any journalists out there interested in making a submission to them? FATCA’s right up their alley:
http://www.truthdig.com/contact/?bn
@bubblebustin..
Go for it. I have emailed Truthdig and tweeted to them I bet 50 times, with no response, yet. So maybe someone else can get through. I would think it is up their alley, but like so many journalist and web sites, foreign Tax policy does not seem to be anything they are interested it, or think their readers will care about.
@just me
Maybe Don Whiteley would consider doing it? He’s got the street creds in the world of journalism to get their attention.
@ bubblebustin
Thanks. Got your photo via Petros. I’d like one or two more for my composite but if not I can make do. Now what should the title be? Have to think on that. When I
look at all those forms the first word that comes to mind is PAIN. It must have been hard for you to dredge up that photo and have to relive the pain of OVDI again so I really appreciate you doing that. You still haven’t got resolution yet have you and that is pain on top of pain — it’s a Sword of Damoclese over your head. I know the sword was supposed to represent what it is like to be a ruler but it is also what it is like to be awaiting a ruling. Damoclese went back to his supposedly happy life as a poor man but then he didn’t have the IRS to deal with did he.
@Em
Thank you for understanding. The fact that the pain still exists is the motivation I have to continue fighting this persecution the USG wishes to inflict on its own. Good luck with the photo collage. Maybe we can get some environmentalists on board too 🙂
@bubblebustin
Thanks for the thought, and I am now figuring out what my next foray in this is going to be. I’m a little swamped with marking papers, finalizing grades etc. for a couple of programs I teach in at SFU — I won’t be able to devote any serious time for another week or so.
I’m also still waiting a response from Vancouver consulate on a request for R/R data. My suspicion is I’m not going to get one, but I haven’t given up yet and I do have other avenues.
I’m already thinking — in a Canadian media context — that a story about what FATCA is likely to cost every single Canadian account holder might be the best angle to pursue — but that’s an early thought in my head right now. I’m also thinking that Flaherty is indeed going to sign an IGA — and that’s likely the best time to strike.
I’ll keep you posted — to the extent that I can.
DW
*arrow – my exact thoughts. i have already started a draft press release on this.
@Arrow
@lioness
Re: “I’m already thinking — in a Canadian media context — that a story about what FATCA is likely to cost every single Canadian account holder might be the best angle to pursue — but that’s an early thought in my head right now. I’m also thinking that Flaherty is indeed going to sign an IGA — and that’s likely the best time to strike.”
You very well may be right about the likelihood of an IGA. I’d like to think Canada could be dissuaded, but without more publicity (which costs $) and the likelihood the Finance Department’s request for public comments is just going through the motions, that may be hard. (Let’s not give up hope, just dealing with probabilities.) On the other hand, if they *do* go ahead and sign one, that may be an opportunity for commenatators and reporters to hear a different perspective (unless everyone’s too busy patting themselves on the back on how Canada “forced” the Americans to compromise and protected Canadian interests.)
Re: “FATCA is likely to cost every single Canadian account holder”, how will you calculate that? Maybe one thought is to try to get an aggragate of how much FATCA compliance would cost Canada (which would have to be based on an estimate, maybe extrapolating from TD’s estimated $100M) and then divide by the number of ciizens? (Actually, that would be something good to get out there before they sign and IGA.)
BTW, another thought that occurs to me. Under “original FATCA,” without IGAs, IRS would have the administrative nightmare of collecting data from every FFI in the world individually. (Maybe this is Obama’s secret employment plan — hiring 10 million new IRS agents just to administer FATCA. That would more than eat up any revenues they hope to “recover.” The ultimate self-licking ice cream cone.) Just think how much that would cost to administer, if Treasury actually had to do that. But under IGAs, we unload that burden on the “partner” government. The Finance Department would probably have to set up a whole new division for FATCA administration and enforcement, to collect and compile all the FATCA-required information from Canadian FFIs, and then tie it up with a bow to ship to the IRS. I can’t begin to imaging the costs of that. Of course, having exported our FATCA enforcement costs I’m suuuuure Washington would reimburse Ottawa for the additional expense . . .
*A couple of things to remember:
We now have less than 21 sitting days left before Parliament recesses in December. That is the bare mininum to “ratify” a treaty that doesn’t require any changes in Canadian domestic law. After the end of December Parliament will not be back until late January at the earliest if not later.
Stopping the government from “signing” a treaty is tougher than stopping the government from “ratifying” a treaty. In theory a cabinet minister such as Flaherty needs the approval of both the Treasury Board and the Privy Council Office(co-located with the PMO in Langevin) with final text in hand before signing. This process is supposed to take six weeks. Flaherty can also let some other lower level official in the public service actually sign in order to put some distance politically between himself and the agreement..
I would like to try to stop a signature but in reality the real ball game is ratification not signature. Canadian governments have learned from the US the art of signing treaties but not ratifying them. If we stop a “signature” it would be one of the rare times a treaty was stopped at the signing phase before ratification in the context of treaties never being ratified.