Thank you for your email following the recent Toronto event held with my colleague, MP Craig Scott. I appreciate your perspective on the meeting. I am glad to have this opportunity to address FACTA further.
I share your concerns that FATCA’s sweeping provisions on financial disclosure will have significant consequences for dual Canadian-American citizens and Americans with landed immigrant status lawfully living here in Canada. Please know that New Democrats have consistently challenged the over-reaching aspects of FATCA and have urged the Conservative government to negotiate protective measures for those citizens who would be affected by FATCA’s onerous regulations.
We are also troubled that the secrecy of these negotiations with the US is detrimental for citizens facing privacy and financial pressures. They must rely on media reports for developing news and have no opportunity to have their views considered in a meaningful way.
In discussing this matter with my NDP colleagues, we felt that it was important to reinforce how serious and unfair the consequences of FATCA could be for Canadians if unilaterally imposed. In taking the lead on this issue, Official Opposition critic for National Revenue, Murray Rankin, has written to Finance Minister Jim Flaherty calling on his government to reject any agreement that may violate the privacy rights of Canadians, erode Canadian sovereignty, or fail to offer Canada equal benefits to those provided to the United States. Please see the attached copy of Murray Rankin’s letter to Minister Flaherty.
Going forward, please be assured that New Democrats will remain vigilant on this issue. We will continue to pressure the Government to help address the above-mentioned concerns and ensure the rights of Canadians who hold dual citizenship with the United States are protected.
Again, thank you for writing. Please know that your steadfast support for our Party is greatly valued.
Thomas Mulcair, M.P. (Outremont)
Leader of the Official Opposition
New Democratic Party of Canada
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September 25, 2013
The Honourable James M. Flaherty, P.C., M.P.
Minister of Finance
Department of Finance Canada
140 O’Connor Street
Ottawa, Ontario K1A 0G5
As Official Opposition Critic for National Revenue, I am writing to express my serious concerns regarding negotiations with the United States over the implementation of the U.S. Foreign Account Tax Compliance Act (FATCA).
Currently, Canada is engaged in closed door negotiations with the U.S. over an Intergovernmental Agreement (IGA) for the implementation of FATCA in Canada. Such an agreement could oblige Canada to enact laws and regulations requiring Canadian financial institutions to comply with this U.S.-based legislation. New Democrats have serious concerns about the lack of transparency and consultation during these negotiations and the potential for such an agreement to infringe on the rights of Canadians and fail to offer reciprocal benefits to both parties.
Reports suggest that if implemented, an IGA may require Canadian banks, investment funds and other financial institutions to disclose annually to the U.S. Internal Revenue Service (IRS) information on accounts held by American citizens, including dual citizens in Canada. Failure to disclose account information could result in a withholding tax applied to U.S. income earned by the institution or by the account holder. We are concerned that these negotiations may allow the United States to bypass the established exchange of information between the IRS and the Canada Revenue Agency and instead get information directly from Canadian financial institutions. Concerns have been raised that such a system could potentially violate existing Canadian privacy laws. Furthermore, at this time it is unclear if reciprocal information would be granted in return.
New Democrats are concerned with the prospect of a foreign nation unilaterally imposing obligations on Canadian banks to disclose personal information. The Canadian Government has a responsibility to protect Canada’s tax base, and while we understand the United States’ desire to protect their own tax base, this should not come at the cost of the rights of individuals residing in our own country. Cracking down on tax cheats should occur through international cooperation rather than unilateral action.
Room 524, Confederation Building, Ottawa, Ontario K1A 0A6
Tel: 613-996-2358 Fax: 613-952-1458 Email: Murray.Rankin@parl.gc.ca
What’s more, the secrecy of the negotiations over this agreement has left Canadians in the dark as to the integrity of their personal banking information. The Canadian government should be standing up for the civil liberties of Canadians. Furthermore, the Conservative government must ensure that any agreement reached is fair for Canada.
In the interest of transparency, fair taxation and respect for privacy rights, we are asking the government to reject any agreement that violates the rights Canadians or that fails to offer Canada equal benefits to those provided to the United States.
In light of the important issues at stake, we urge the government to bring transparency to this process and inform Parliamentarians on the state of negotiations.
I appreciate your time and look forward to your response.
Murray Rankin, Member of Parliament for Victoria
Official Opposition Critic for National Revenue
cc: Peggy Nash, Official Opposition Critic for Finance