29 thoughts on “Ottawa promises to make #FATCA IGA public after signed!”

1. That’s very kind of them. This nonsense is going to really blow up here in Canada. There’s just no way they can get a deal that doesn’t violate the laws here. I cannot see a way. The fact that none of these “talks” are public is another issue. How on earth are they going to say this isn’t a treaty over ride? How can the justify this without a debate? The people affected by this are having no input or say at all? U.S. has to know by now the issues here.

2. The problem is if you go to Ottawa right now most MP’s are going to say they know no more than we do without a signed agreement in hand. Those of you in the Toronto and Southern Ontario areas should start considering making travel arrangements to Ottawa this fall.

3. My Mp just fired off a letter telling me to get twenty five signatures then he maybe could “bring it up” Someone before me had already gathered that many signatures for him to be formatted in a certain manner but, I was told to do it again. He then forwarded me a letter sent to him by the U.S. government stating that the U.S. had been taxing it’s citizens since 1913 and other ridiculous justifications for FATCA. That was it. I didn’t even get to speak to the MP myself which never happened with our former MP who was very accessible. MP’s aren’t doing much about this except for a very few.

4. Okay so where’s the lawyer and how do we “get ready” I’m ready.

5. Warning: Mad Rambling Rant Ahead

   They are definitely pulling a Pelosi on us. Negotiate FATCA in secret — reach a sell-out deal — force the deal through parliament — provide the details to the public afterwards — suppress the outrage by the usual propaganda techniques including tagging anyone who objects as a tax cheat. Sorry Harper but my rage will not be suppressed and when the unaware 99% of our million in Canada wake up I hope they’ll find their inner rage too. This is not unexpected but it still makes my blood boil. Marie’s telephone conversation with the CRA “competent authority” is looking very much like cat out of bag.

   The damage that automatic FATCA reporting can do (and FBARs have always done) cannot be undone AFTER the data has been surrendered to the USA. It doesn’t even help to change the numbers on your bank accounts each year because with high balances being reported you just double your trouble. When I saw “loyalty cards” in stores appear I quickly understood the danger of data mining and would not take part, despite having to pay more at the checkouts (always in cash, BTW) because lower prices were only given to card holders. FATCA is a loyalty card scam overdosed on data gulping steroids with no rewards at all, only penalties. We will now see an exponential growth in the compliance industry but dare we hope a privacy protection industry will also arise? Those of us who value our privacy need legal antidotes for the toxic surveillance state and we need them soon.

   In our case, my husband will be exiting properly from US tax trap tyranny but there’s no way for me to do so, even if I was inclined to want to, which I am not. I’ll wait to see when and how I get pushed and if I have to I’ll empty my bank accounts — on my own terms — not theirs. And since I’m feeling bitchy today (it’s HOT!) I will add that traveling to the USA, for me, would be a punishment not a privilege. Canada would have to extradite me to get me there.

6. FYI,

   I don’t have a video I can upload but MP Ted Menzies spoke a couple of weeks saying that he personally respected the “sovereign” right of the United States to tax its citizens residing in Canada and it was important for all Canadians and the Government of Canada to “respect” the sovereign right of the United States to enact its own tax laws.

7. Did not like how the author framed us as having ‘ignored’ our tax filing obligations. Way to encourage regular Canadians to resent us.

8. Ted Menzies won’t run in 2015 and doesn’t want to be a cabinet minister, preferring now to spend time in his home riding as he wants to spend more time with flood ravaged communities that he represents. I respect that.

   I don’t respect that he doesn’t respect the sovereign rights of all Canadians set out in the Canadian Charter of Rights and Freedoms, that Canada would waive that privacy to cede to FATCA. He’ll probably find many of his constituents in southern Alberta are considered ‘US Persons’, adversely affected as well by Canada not standing strong against the US unilateral (faked to be reciprocal) FATCA.

9. In the same statement he acknowledged that many of his constituents are effected but as a cabinet minister he must uphold international “law” and be respectful of sovereignty.

10. And many constituents complained to his office.

11. US sovereignty. At least he won’t want Finance Minister Flaherty’s job.

12. Transcript:

    Senator Hervieux-Payette: A particular issue is causing me great concern, and I have not found an answer to my questions in the document’s 900 pages.

    We are learning that Canadian citizens of U.S. origin, after decades, have to submit tax information to the U.S. authorities. Does a Canadian-born American who returns to the United States have the same problem? This issue is probably not covered in the bill. However, there are usually measures — and we see that in a number of provisions — that help us determine where the income was earned and where it is taxable.

    How will the government treat those Canadian citizens who have incurred absolutely incredible obligations to the U.S. tax system?

    [English]

    Mr. Menzies: If I can just start off, we actually were debating a bill in the House of Commons yesterday on double taxation agreements or treaties with other countries. We have a number of those in place — correct me if I am wrong, but I believe it is at least 60 different treaties on double taxation — to ensure that if you pay taxes in one jurisdiction, you do not pay the same tax in another jurisdiction.

    You are referring to FBAR; that is the acronym used. Minister Flaherty has been working with his counterparts in the United States. The officials will correct me if I am wrong, but it is the legal right of the United States. American citizens should have known that they at least have to report tax, even if it is not payable. It gets to be a real challenge.

    I have constituents who have come to me and said, “I cannot believe my tax bill.” They claim they did not know.

    As to the reverse, I do not know. I would refer to one of my officials. You are asking more about the reverse, and I do not have an answer for you.

    Senator Hervieux-Payette: Yes, how do we treat that here?

    Mr. Cook: I can give some brief comments generally on how the Canadian tax system works in comparison to the U.S. tax system.

    In terms of your specific question, there is nothing that I am aware of that specifically goes to the treatment of Canadian residents or U.S. citizens in terms of how their tax treatment in the U.S. is affected in any significant way by this bill.

    However, as a general matter, Canada, like most countries, taxes on the basis of residence. Residence is a test as to where you make your habitual abode, where you live and where you carry on your activities. For those people, we tax them on their worldwide income. For people who are not residents of Canada, we just tax them on their Canadian-sourced income.

    The actual question of citizenship does not directly come into play in terms of Canada asserting its tax to right. The U.S., on the other hand — and in contrast to just about all other major countries — has made the decision that it will continue to try to exert the right to tax over its citizens. It has created a number of tricky issues. In fact, there are a host of rules in the Canada-U.S. tax treaty to deal with various issues that arise where you have someone who might be a citizen in the U.S. but who is resident in Canada. The short answer is not directly dealt with in the bill; it is just as a result of the U.S. taxing on a different basis than we do.

    Senator Hervieux-Payette: I would have been tempted to put a section in that bill just as a negotiation with the U.S. because our own people are being penalized, so if it has anything in exchange — I think that might not have been a bad thing.

    What are we doing? Is there a section that will deal with Tim Hortons or Starbucks or all those multinational corporations? Are they all paying taxes in this country? Are we making sure? Do we have a section here that will cover that so that there is no billing in one place and revenue declared in the other place? Have we managed to correct the situation that happened in England and maybe in other countries?

    Mr. Menzies: I was just at the OECD annual meetings. The OECD is working on what is referred to as “base erosion” and “profit shifting,” which is exactly what you are talking about. All of the OECD countries are seized with this and very concerned about it. However, it is a matter of this country giving tax credits. Are they realistic credits or is it just an opportunity for a company to shift its profits? Everyone is very concerned.

    The G8 has asked the OECD to do some analysis on this, and that will be later this year. I believe they are coming forward with a report to the G8 because it is certainly an issue, and it has been highlighted in the media recently.

    It is not just Canada that is concerned about it; other countries are, too.

    Senator Hervieux-Payette: No, but we have 900 pages. I thought we might have addressed this question before the others. I agree that other countries have to make their own decisions, but it is up to us. We are importing manpower and exporting profit. I have a little problem with that.

    Mr. Cook: To build on the minister’s remarks, at a general level, what you have been talking about is transfer pricing and profit allocation between different jurisdictions. That is one aspect of taxpayers seeking to take advantage of advantages through creative use of the tax system.

    In terms of what is in this bill, it does contain a number of integrity measures designed to protect the Canadian tax base and in some cases to deal specifically with foreign tax planning.

    To give you one example, the implementation of a measure first announced in Budget 2010 is a measure dealing with what we call “foreign tax credit generators.” It is tax planning that was being used by Canadian taxpayers, primarily financial institutions, which would seek to set up a series of arrangements in another jurisdiction to artificially create income and tax in the foreign jurisdiction, which would create foreign tax credits in Canada. In a sense, that is the same kind of basic issue because they are trying to take advantage of differences between the Canadian tax system and the foreign tax credit generators we have seen, the U.S. tax system.

    Senator Tkachuk: You mentioned in Parts 2 and 3, minister, our wish to have an equitable tax system on multinationals and their foreign holdings and how they are dealt with. Are these confirmations of existing tax laws that multinationals may not have understood properly or are they new taxes?

    Mr. Menzies: My understanding is that these are taxes that were already in existence; we are not changing them. The amendments in respect of foreign affiliates, which are in Part 3, are to tighten it up. I will let the officials elaborate further on it. However, we put in a number of measures in Budget 2013. We put forward 75 different improvements to close loopholes, some of them within Canada itself.

13. Menzies says Canada “must uphold international “law” and be respectful of sovereignty”. Is he a Canadian representative, or has he been elected as a member of the US Senate or Congress? Perhaps he’s been drafted to work for the IRS and Treasury too?

    What about Canada’s sovereignty and autonomy? Is his elected and sworn duty to Canada not higher and more pressing than whatever he cites as compelling about being ‘respectful’ of US ‘sovereignty”? Is Canada always ‘respectful’ of what the US wants? Always? No exceptions where Canada’s interests are in conflict? What BS. This is just convenient for him to claim.

    Does a Canadian elected official like Menzies not have a present and compelling duty to CANADIANS? Does our CANADIAN citizenship by birth or by oath mean nothing? Do the ‘tricky issues’ he notes re the US ‘unique’ system of taxation trump the systems and norms of Canada and ALL other countries of the world (just as they refuse to except that of Eritrea)?

    Is he an expert on US taxation and financial reporting and US citizenship laws? And should we be so as well by osmosis – despite the ignorance or misinformation that even tax and accounting professionals INSIDE the US and crossborder in Canada had (and some still have) in regards to the FBAR, and other insanely complex US laws regarding those living and working entirely outside the US? A

14. Tim, so is Ted Menzies an idiot or just a tool? Because he either hasn’t done his homework (which is cause for his dual constituents to march ala Egyptian style on his office) or he isn’t smart enough for his job, which begs the question of why he was elected in the first place (oh, and that is rhetorical. I have been in Canada long enough now to have observed this MP election process in action and it’s pretty stinky business). He is incorrect about people who should have known. There is no reason why a dual born, raised and living outside the US should have any knowledge of the US tax system or even for them to realize that it differs from the one in their own country. Given the absurdity of world-wide taxation, which almost every other country recognizes, why would anyone not born and raised in form nation know about the filing and compliance stuff? Perhaps this gets back to the false notion that Americans and Canadians are the same thing? Though I don’t know any Canadians personally who think that while I know that most Americans do. Is Ted an American too?

    AtticusinCanada, I am in a similar position to yours and my spouse is livid, so I try not to bring the topic up often. Fortunately, we aren’t too financially entangled, but I see no hope for people like us beyond giving up our citizenship in the US. Even though I don’t met any requirements to file anything, I do file a 1040 (I work here and there but nothing that really pays) b/c I want to continue the paper trail I started when I was living there. I am even toying with the idea of having the child start filing when she hits junior high. Just in case the requirements change for teens who are renouncing. It infuriates me that the the US uses my marriage to ensnare my spouse but that the same time won’t allow me to move back to the US with him to live b/c he is “foreign”. Good enough to steal from but not good enough to live there.

15. How does Menzies explain away how US ‘sovereignty’ in tax matters penalizes us from holding the TFSA and RESP that his party and Finance Minister take credit for inventing, and which they heavily tout as a vehicle for savings that ALL CANADIAN citizens and residents should be using to ensure their family’s wellbeing? His government has failed to have them exempted under the US Canada Tax treaty provisions.

    How does he explain how, why and when he will assert and justify in public and in Parliament that it is right and good and serves Canada’s interests – that the Canadian RDSPs and disability grants of Canadian citizens and residents are taxed via the ‘sovereign’ right of the US – which he elevates above the rights and wellbeing of Canadian citizens and residents with disabilities – and prevents their families to save and provide for those who are not able to?

    How does Menzies justify elevating US taxation – and the punitive treatment of all Canadian registered savings as ‘foreign trusts’ – taxing them and penalizing any failure or error in their complex reporting requirements?

    How does Menzies justify his elevation of US interests in taxing the capital gains from the sale of our Canadian principal residence – by definition on Canadian soil?

    I think that those examples would make him and any other MP look like fools in public if they were pressed to justify that.

    And, will Menzies assert to us in public, in Parliament, his defense that respect for US sovereignty trumps the Charter, and our Constitution, and means that he agrees fully that the accounts and assets of Canadian employers, business partners, voluntary organizations etc. who ARE NOT US persons should gladly agree to having their information reported annually to the US on the FBAR simply whenever a dual or US person involved with them has any co-signatory or other power associated with their NON-US Canadian generated and held accounts?

    There must be some of his colleagues that have these powers – who would have an FBAR burden – and who would be reporting on Canadian government accounts, or the accounts of other Canadian entities. He must know other Conservatives who hold positions on boards, or who are treasurers, etc. In the Canadian and provincial civil service, school boards, municipalities, hospitals, etc. there certainly must be people who have those powers over Canadian accounts, who technically would be bound by US law to report those assets on FBARs though they do not own them. That would directly conflict with their principal duty to their government employer. What is Menzies position on that?

16. My above quote was what Menzies actually said. There were no references to sovereignty or international law. The person who gave me this information before the transcript was released was a bit too excited. This is the key passage though.

    However, as a general matter, Canada, like most countries, taxes on the basis of residence. Residence is a test as to where you make your habitual abode, where you live and where you carry on your activities. For those people, we tax them on their worldwide income. For people who are not residents of Canada, we just tax them on their Canadian-sourced income.

    The actual question of citizenship does not directly come into play in terms of Canada asserting its right to tax. The U.S., on the other hand — and in contrast to just about all other major countries — has made the decision that it will continue to try to exert the right to tax over its citizens. It has created a number of tricky issues. In fact, there are a host of rules in the Canada-U.S. tax treaty to deal with various issues that arise where you have someone who might be a citizen in the U.S. but who is resident in Canada. The short answer is not directly dealt with in the bill; it is just as a result of the U.S. taxing on a different basis than we do.

17. As Blaze on Maple Sandbox put it to me this statement is as clear as mud.

18. It begins to sound as if not only can we not figure out what the U.S.wants without extensive help but, the IGA will be so complicated we may as well camp out in a tent outside a tax professionals office. How handy for that profession! I guess that’s what the “Hire” act meant by “creating jobs” Yes, for the IRS and the tax attorneys and preparers. And if the fines on FBAR are anything like they might be, a tent is all we’ll have left to live in too!

    *Waves to NSA* This entire thing is nothing but, a bullshit imperial over reach on innocent EX citizens of the U.S.S.A. And no, I don’t CARE anymore who knows what I think of that country. It took a lot to get me to feel this way so good job, way to go U.S. you have successfully turned millions of people who used to support you into people who want nothing more to do with you. Base erosion my ASS! You haven’t seen anything yet like the “base erosion” you’re going to see when millions of Canadian duals get their renouncing over with. Better “Hire” some more people at the embassies here in Canada to deal with it.

19. @AtticusinCanada

    We may very well be the last generation of Americans to believe we were free to wander where we may, as erroneous as that may have been. This will be the end of the American diaspora and the building of fortress America.

20. This Globe article is closing in on 300 comments. All Brockers should add their 2 cents. The more comments, the more people will notice. We need TO BE LOUD!

21. @bubblebustin, I think you are right and I also think they will regret being so insistent that everything had to be just this way. The very least they could do is provide an easy way to renounce, no questions asked, ties cut. They weren’t worried about “base erosion” for the entire 35 years I’ve been in Canada until now. In fact they acted as if we didn’t exist.

    I’m really sorry for those who will come after us and who will not be able to experience living abroad outside the U.S. It widens ones horizons and it helps the U.S. to understand other perspectives. They don’t see that though. All they see is they want an imaginary wall around the border to keep everyone in. We’ll be a good example “See what happens to you when you dare to not live here.” Brother, never thought I’d see the U.S. become so backward.

22. @AtticusinCanada

    I see you have been busy with your replies on the G&M article. Well done…

    Guess we all just sit back now and see if Mr. Cockfield’s GATCA ‘love child’ born out of FATCA impregnation is still aborted by U.S. Congresses failure to impose a DATCA on USFI’s. Not sure how they will get GATCA without a DATCA

23. Long term U.S. citizens abroad now fall into one of two groups.

    Group 1 – Those who are NOT tax compliant and will most probably go into hiding. They can’t return to the U.S. because they must then file tax returns. (Where have they been all these years?) They are unlikely to come into compliance here because it is too dangerous and expensive.

    Group 2 – Those who are tax compliant and must choose between renouncing or returning.

    After all of this, most will want to renounce.

    So, U.S. citizens abroad will not be returning to the U.S. They are exiled.

24. I am supposedly “not compliant” even though the IRS told me I did not meet the requirement to have to file so dumb me, I listened to them and did not file. Maybe, I’m okay on that score but, I was never once told about FBAR. I called the IRS every year to make sure I was still okay with them and not once did anyone tell me about FBAR. I want to renounce but, I’m scared stiff about starting to file paperwork with this vicious agencies because FATCA has been pushed forward as a way to raise money out of “tax cheats” Something I was told I was NOT directly in the past by the IRS. I cannot prove they told me that. I have one year where I had some income but, I paid them too much off the top and they OWE ME six hundred bucks. I never sent that one in since they owed me so I didn’t think they cared about that and didn’t get in a big hurry about it.

    I feel trapped. I just want out of this mess before it affects my spouse who is already said no way. He’s not paying any fines, he’s not giving over info, he’s not doing it period and I don’t blame him.

    I guess I’ll just go ahead and see what happens to me. If they assess a fine I just won’t be able to pay it and won’t go back there again. This is going to go over with my family in the U.S. like a lead balloon.

25. I sent my MP this link…He responded within the hour on his blackberry…I also said I want to meet him in person.

    this is what he wrote me…
    “Thank you for this. I will look into this issue.
    It is important. All the best,”

    Well, I will be relinquishing on July 15th….I hope all goes well. I want to wear red and white (LOL)