The Government is also engaged in negotiations with the U.S. for an
agreement to enhance information exchange under the Canada-United States
Tax Treaty. The agreement would include information exchange
provisions in support of the United States Foreign Account Tax Compliance
Act provisions.
Under the agreement, information exchange would be improved on a
reciprocal basis to facilitate tax compliance in both countries. The agreement
would reflect a commitment by Canada and the United States to work with
other partners on adapting the terms of the agreement to a common model
for automatic exchange of information. page 156
Let the games begin!
This is the same boilerplate they put out last fall. My guess is that, if they are ready to proceed (and I don’t really think they are) it will come out in the omnibus implementation legislation down the road a ways.
Except as we know, re …”to facilitate tax compliance in both countries.”… that means Canada choosing to play the role of traitorous collaborator via discriminating against citizens (both by Canadian birth and naturalization) and permanent residents of Canada, to assist the US in enforcing an unjust and punitive extraterritorial system – wherein those affected in Canada comply with TWO tax agencies – and in some cases are double taxed, or taxed on assets not taxable where they reside and receive actual services.
Doesn’t really say anything we don’t already know. I would not expect him to reveal details or his bottom line position in the middle of the negotiations. So…we’ll just have to wait and see what comes down.
Well that certainly appears to be announcing the arrival of the fricken FATCA bus in Canada, complete with its Model 1 IGA chassis. Weasels! I notice they didn’t make it easy to find the reference to FATCA and that it is buried in chapter 3.2 (page 166 of the pdf).
http://www.budget.gc.ca/2013/doc/plan/toc-tdm-eng.html
There’s a whistle-blower clause too but it’s to catch the “whales”, they say …
The CRA will also launch the Stop International Tax Evasion Program aimed
at reducing international tax evasion and avoidance. Under this program,
the CRA will pay rewards to individuals with knowledge of major
international tax non-compliance when they provide information to the CRA
that leads to the collection of outstanding taxes due. The CRA will pay a
reward to an individual only if the information results in total additional
assessments exceeding $100,000 in federal tax. In this way, the CRA will
target high-income taxpayers who attempt to evade or avoid tax using
complex international legal arrangements. A reward will not be paid to an
individual who has been convicted of tax evasion in connection with the
non-compliance.
I would say reading the budget as a whole it is unlikely that IGA implementation bill will be included as part of the larger omnibus budget bill. If you look at the annexes they actually have draft legislative text to implement most/all provisions announced in the budget(ala Governor General must pay HST, Hospitals must charge GST/HST at “paid” parking lots/garages, elimination of some of the corporate tax “funny business”). So at the very least I don’t think any FATCA IGA implementation legislation will be part of the spring budget bill. Of course that leaves the question of a Fall budget bill. The problem with a Fall budget bill is might not be one. This budget is pretty Spartan I don’t see why almost all of the changes announced(eliminating tariffs on imported hockey pucks) can’t be all wrapped up this spring.
If they didn’t say anything about FATCA(as much as I would have liked to see that) it would have been a signal to the banks and the US that perhaps they pulled the plug on negotiations something I don’t they are willing to do. All in all I am relatively pleased. If they had announced more concrete measures towards implementing FATCA.
Well, wouldn’t it be the US to strong arm other countries, and see it get spun into a ‘bilateral agreement’.
Also, much as I would like to think otherwise, if push really comes to shove, I wouldn’t trust the US to not try and free the shit out of a weaker nation in order to prove their point.
Meanwhile, I beginning to believe more strongly that if I’m to protect my rights as a permanent resident of Canada under the Charter, that I’ll have to become stateless to do it, because I simply don’t know if Canada will stand on guard against US bullying, or even see it as any sort of threat, and the banks here seem to want to fall over each other in a rush to sell me out because of my unwanted US personhood.
@Tim
I really hope you’re right on this.
We have Green Party, we have CCLA, we have 1,000,000 of us. We will be fine.
“The Government is also engaged in negotiations with the U.S. for an agreement to enhance information exchange under the Canada-United States Tax Treaty. The agreement would include information exchange provisions in support of the United States Foreign Account Tax Compliance Act provisions.
Under the agreement, information exchange would be improved on a reciprocal basis to facilitate tax compliance in both countries. The agreement would reflect a commitment by Canada and the United States to work with other partners on adapting the terms of the agreement to a common model for automatic exchange of information.”
I guess we’ve just been thrown under the bus.
Noted on Jim Flaherty’s FB page –
“Section 3.2” – “The Government is also engaged in negotiations with the U.S. for an agreement to enhance information exchange under the Canada-United States Tax Treaty. The agreement would include information exchange provisions in support of the United States Foreign Account Tax Compliance Act provisions.
Under the agreement, information exchange would be improved on a reciprocal basis to facilitate tax compliance in both countries. The agreement would reflect a commitment by Canada and the United States to work with other partners on adapting the terms of the agreement to a common model for automatic exchange of information.”
While the US is forcing the entire world to search bank, brokerage, fund management and insurance company customer databases for those with US indicia, the US is offering to “pursue the adoption of regulations and advocating and supporting relevant legislation to achieve such equivalent levels of automatic exchange.” (Model 1 IGA, Article 6.1) That doesn’t sound like a reciprocal undertaking, does it? As of 1 January 2013, US financial institutions will be required to report to the IRS US-source interest income of accounts belonging to non-resident aliens (US parlance for those resident outside the US). The US has agreed to share this data with 80 countries of its choosing. However, this is unlikely to be of any use to recipient countries because it is so easily side-stepped. Any income that is not interest income will not be reported and any interest income that is not US sourced will also not be reported. I would expect these accounts will hold dividend paying stocks (not reported) or foreign bonds (not reported). Furthermore, the undertaking to think positive thoughts about reciprocal information exchange is given by the executive branch and not the legislative branch which is responsible for, you know, legislation. FATCA is unbelievably one sided and deliberately so.
FATCA is the height of US arrogance and hypocrisy
Thank you for throwing 1,000,000 Canadians under the bus!
@The_Animal
Agreed 100%
Thanks, Edelweiss, used part of your post on ” From Moodys Tax Advisors Blog: “Is Divorcing Uncle Sam Right for You?”.” and told Jim Flaherty exactly what I thought of him.
Dear John Weston:
Now I know what party several hundred thousand Canadians and their families WON’T be voting for next election.
excerpt from Credit Union Central of Canada http://www.cucentral.ca/Lists/MainNews/DispForm.aspx?ID=98 http://www.cucentral.ca/Connections/other%20budget%20issue%20cu%20taxation%20Final.pdf
March 21, 2013
CONNECTIONS
‘Good News/Bad News: Other Taxation Measures’
Gary Rogers, Vice President, Financial Policy, Credit Union Central of Canada
“FATCA
Credit unions have growing concerns about the compliance burden they may face, beginning in
2014, to comply with the United States Foreign Account Tax Compliance Act (FATCA). The first
reporting is scheduled to begin in 2015, for new accounts in excess of $50,000 opened after 2013, and for pre-existing accounts with more than $1 million.
We impatiently await the progress of negotiations between Canada and the U.S. that will result in an Intergovernmental Agreement (IGA) detailing the requirements for Canadian financial institutions, including credit unions.
Canadian Central is working with Finance Canada to maximize exemptions and streamline the
requirements for small financial institutions. We are also working closely with other national trade
associations for financial institutions and with WOCCU to ensure we speak with a common voice
to government.
Budget 2013 refers to the negotiations and states: “Under the agreement, information exchange
would be improved on a reciprocal basis to facilitate tax compliance in both countries.” This may
suggest that part of the delay in reaching an IGA is extracting some concessions from the
American government that will provide some benefit to Canada.”
Ran into this “Financial Post” article. http://business.financialpost.com/2013/03/22/did-the-budget-really-give-the-cra-new-teeth/ – The comment section posts have given me an insight on the humanity of the regular Canadian public who have no idea of the absolute tyranny that is the US tax system – they have none. Considering the slavering masses who will turn in their grandmother to the CRA if the grandmother has foreign accounts; I see no satisfaction coming from the Canadian government.