A law enforcement officer who is an “Accidental American” writes the Prime Minister asking for the protection of the Canadian government.
Dear Mr Harper;
According to a story in the National Post dated September 20, 2012 the Canadian government forced Eritrea to nix a ‘2% extortion tax’ on its citizens in Canada. According to the story, the RCMP and United Nations reported that those who refused to pay were subjected to threats, intimidation and coercion. Canadian Foreign Affairs officials sent off a strongly worded diplomatic note making it clear Canada would not renew the accreditation of the Eritrean consulate unless Eritrea agreed in writing to stop the scheme.
Eritrea, referred to by many as the “North Korea of Africa”, is one of the most highly militarized, secretive, corrupt countries in the world. And that is not all it has in common with the US under this current administration. These are also the only two countries in the world that collect taxes based on citizenship, not residency.
I am a “border baby”. Back in the 1950’s, when the US was a friendly, benign neighbour, it was not uncommon for expectant mothers to cross the border, have their babies and return home to Canada. That is my only connection to the US. My parents are Canadian and I am Canadian, but I was born in the US. That fact was always just a novelty until recently.
As you are no doubt aware, on March 18, 2010 the US government (Democrat) passed the Foreign Account Tax Compliance Act (FATCA) which is set to come into effect on July 1, 2014. Under the guise of targeting tax cheats and money launderers, this law affects and will potentially devastate hundreds of thousands of honest, law-abiding, tax-paying Canadian citizens. Many of these Canadian citizens, myself included, have never lived, worked or voted in the US. We do not have the same rights as “other” US citizens. For example, I have a daughter attending university in the US. Her life would be made simpler if, like real US citizens, I could pass on my citizenship to her. Because I have not lived in the US for five years (I have never lived there), I cannot pass citizenship on to her. In other words, because I have never lived there I do not have the same rights as other US citizens, but apparently I still have the same obligations.
FATCA is an obvious violation of the Canadian Charter of Rights and Freedoms (not to mention privacy, human rights and banking laws). Having worked in law enforcement for 32 years, I have seen the worst criminals in Canadian society afforded protection against unlawful search and seizure. I may be naive, but I would like to believe that the Charter affords the same protections to honest citizens that it does to our most heinous criminals. FATCA is a classic “fishing expedition”, and I trust your government is not going to sign any Intergovernmental Agreement (IGA) with the US in an effort to deny me, and others in the same situation, the same rights afforded Paul Bernardo. It is clear that the current US administration has no respect for their own Constitution, so I do not expect them to have any respect for ours. I do expect you, as leader of our sovereign nation, to ensure that our laws are respected.
Your government has been talking a lot about bullying recently. Public Safety Canada has a document dated November 18, 2013 titled “Protecting Canadians from Bullying and Cyberbullying” which starts, “The Harper Government recognizes that bullying and cyberbullying are serious concerns for Canadian families and communities.” Is your government going to back up its talk with action, and stand up to the bullying by the current US administration? Please do not pretend that you are concerned about bullying if you are just going to be bullied into signing an IGA as a way of bypassing protections that should be afforded all Canadians. It appears I have the misfortune to be a second class citizen in two countries. After a lifetime of paying taxes and volunteering and making a positive contribution to this country, I think the least I can expect is for my government to afford me the same protections given those who came here from Eritrea who likewise were subject to threats, intimidation and coercion by a foreign government. It is easy to stand up to Eritrea, but it takes a principled government to stand up to the most powerful bully on the planet. I would like to point out that my Certificate of Canadian Citizenship certifies that I am “a Canadian citizen under the provisions of the Citizenship Act and, as such (am) entitled to all the rights and privileges and (am) subject to all the duties and responsibilities of a Canadian citizen.” I have lived up to my obligations, are you going to live up to yours?
The actions of the US would appear to be a violation of The Master Nationality Rule, which is listed under Article 4 of The Hague Convention on Certain Questions Relating to the Conflict of Nationality Laws of 1930. In terms of practical effect, it means that when a citizen is in the country (Canada) of one of his two or more nationalities, that country (Canada) has the right to treat that person as if he or she were solely a citizen or national of that country (Canada). In other words, I am solely a citizen of Canada while in Canada. If I am not afforded the same protections as other Canadians, that is a violation of section 15(1) of the Charter which states, “Every individual is equal before and under the law and has the right to the equal protection and equal benefit of the law without discrimination and, in particular, without discrimination based on race, national or ethnic origin, colour, religion, sex, age or mental or physical disability.” Am I not entitled to the same protections offered Canadian citizens born in Canada or Eritrea?
As I understand it, some other countries (including China and Russia) are resisting the implementation of FATCA, particularly unless the US reciprocates, which is clearly not going to happen. Under Article 6, Paragraph 1 of the IGA released today, under the heading Reciprocity, it states, “The Government of the United States acknowledges the need to achieve equivalent levels of reciprocal automatic information exchange with Canada. The Government of the United States is committed to further improve transparency (comforting from the most transparent administration in history) and enhance the exchange relationship with Canada by pursuing the adoption of regulations and advocating and supporting relevant legislation to achieve such equivalent levels of reciprocal automatic information exchange.” I am no lawyer, but I can easily see that we are selling them the farm and they are promising to try to come up with the money (which they know they cannot achieve). I have learned two things watching the current US administration: 1) they treat their friends like enemies and their enemies like friends; and 2) they are bullying thugs who, like most bullies, will back off when someone stands up to them. I am quite certain that you know there will never be reciprocity, but you let them use the weasel words to avoid something they cannot achieve.
Was taxation without representation not the catalyst behind the Boston Tea Party? Jacob Silverman, in How the Boston Tea Party Worked states, “Unlike their British brethren, the people living in the 13 colonies did not have direct representatives in the British parliament. Because of that, the colonists had no way to vote for how they would be taxed or who would represent them. And because of this lack of representation, the British government was free to tax the colonists in any way — and for any amount — that it saw fit. With no way to fight taxation and no way to claim their rights, many colonists feared that their property could be taken away through debilitating taxes.” As a result of the current US administration’s disdain for their own Constitution, the US has come full circle and turned into what it once despised. Like those colonists, I have no good option. I should have an advantage over them, in that Canada is allegedly not a colony of the US, but whether that is true or not will be seen in how our government resolves this issue.
From my investigations, here are my options:
1. Turn myself in to the IRS and admit I am a tax cheat and a money launderer and trust that they, in their benevolence, will figure out that the fact I do my banking in Canada where I live, work and pay taxes has nothing to do with hiding money in offshore bank accounts. While I cannot imagine that I would owe any US taxes, they have it set up so their penalty schemes (in particular regarding FBARs) could amount to hundreds of thousands of dollars. Even to try to become “tax compliant” at this stage would cost a minimum of thousands of dollars in tax lawyers/preparers fees and tens (or hundreds) of thousands of dollars in penalties – all for no taxes owed. This is not a good option.
2. Renounce my citizenship. I would be happy to do that to avoid FATCA, FBAR and having to deal with an out of control US administration. From my investigation, in order for me to be allowed to drop my citizenship, the IRS will require a net worth assessment of all my assets and will tax me on what I have spent a lifetime accumulating before letting me go. This is also not a good option.
3. Trust the Canadian government, who I have paid taxes to for the past 40 years, to exert its sovereignty and stand up for its citizens. Trust that the Canadian government will assert that all Canadian citizens are equal and have equal rights and will insist that the US leave Canadian citizens alone, or at least provide an easy means to relinquish US citizenship without being extorted. This is the option that I am hoping for so I do not have to resort to option 4.
4. Bury my head in the sand and hope for the best. Do my best to hide my modest bank accounts from the IRS and continue to provide for my family. Trust that the Canadian government (which did not live up to its obligations under option 3 above) and Canadian banks will not take my money and turn it over to the IRS. Run the risk of spending the rest of my life in jail the next time I cross the border into the US. Recent postings out of Belgium indicate that Belgian banks are seizing customers bank accounts until they can prove they are US tax compliant. Is this what is in store for Canadians?
This is not a situation I even could have imagined would be possible as I approached retirement. This type of behaviour is not surprising for Eritrea, and I guess it is also the norm in Obama’s US. I recently read an article with the headline, “U.S. Treasury Department officials dispute claims that FATCA is causing hardships for law-abiding Americans living outside the U.S.” They know the hardship it is causing, but are wilfully blind and people like me are the low-hanging fruit. There is no political downside to this for an administration whose every act is based on politics not principles. If they raised taxes on Americans, there would be a political price to pay. If they try to financially decimate Canadians, who cannot vote and do not have representation in the US, there are no consequences.
Canada is definitely not a tax haven and the taxes paid here far exceed what would be paid in the US. This should not be a matter where the Minister of Finance tries to find a way to acquiesce with American demands, but where the Minister of Foreign Affairs lets the US government know that we are a sovereign nation, not a US colony. Otherwise, you should seek an amendment to the IGA released today, under Article 1, Definitions, Paragraph 1 b) to say, The term “U.S. Territory” means American Samoa, the Commonwealth of the Northern Marian Islands, Guam, the Commonwealth of Puerto Rico, the U.S. Virgin Islands, or Canada.
The doctrine of dominant nationality deals with situations where two or more nations claim jurisdiction over an individual based on dual nationality, which may lead to disputes between the nations claiming the allegiance of the person. Considerations by which an individual’s nationality would be evaluated include habitual residence, the conduct of the individual in his economic, social, political, civic and family life, as well as the closer and more effective bond with one of the two States.
I grew up near the US border and crossed the border almost daily. I have met lots of Americans and had lots of American friends. The best man at my wedding was an American. Most Americans I have met are just like me: honest, decent, hard working people, trying to earn a living and raise a family – and banking where they live. I have always had a great deal of respect for Americans and the US as a general rule. That is why my criticisms of the US have all been prefaced by the “current US administration”. I have seen a big change in the US under this administration. Currently, each branch of the US government (including IRS, FBI, EPA, NSA) is used as a weapon to punish political opponents. For the Canadian government not to recognize this, and take a firm stand against this tyranny, is to do so at your own peril. If you are willing to sacrifice people like me today, who will they come after tomorrow?
The Republican National Committee approved a resolution on January 24, 2014 calling for the repeal of FATCA. Headlines around the US are portraying the GOP as trying to shelter millionaire offshore tax cheats. Americans have no idea that this law will not catch tax cheats or money launderers, but will devastate millions of honest citizens who are no different than them. This piece of legislation has forced traditionally pro-American people like myself to come to detest Obama’s America. Should the Canadian government not be trying to engage the US media and enlightening them on the true nature of FATCA?
Please assure me that your government, fresh off a principled tour of the Middle East, is now going to exhibit the same principled stand against the current US administration. It is worthwhile considering the number of Canadian voters who will be affected by this (they all will at least indirectly, some just do not know it yet). I, and all the others directly affected by this, will easily recognize if we have been betrayed by our government and act accordingly where we do vote (Canada).
Sincerely,
Canadian Cop
(I used my real name in the letter forwarded to Stephen Harper and CC’ed to Scott Armstrong, John Williamson and Ted Hsu.)
This post first appeared, February 5, 2014.
@Canadian cop
Your letter was very moving. Thank you.
Regarding your MP’s comments about registered accounts, RRSP, RESP, TFSA, etc., only the financial institutions are exempted from reporting these. The tax payer must still report all off these accounts on FBAR’s as well as report the income/gains/grants received on your tax return.
…AND
All stakeholders involved are happy with the IGA?
I would ask Scott Armstrong MP where he’s getting his misinformation from.
@Canadian Cop
Anderson’s assurance “that people in [your] situation have nothing to worry about” strikes me as being particularly asinine and infuriating – if that’s the case, why isn’t that fact codified in law? The degree to which you should be concerned is largely out of the hands of your elected representatives…. that is to say, they sold you out, and now they’re trying to assure you that they didn’t, not really.
@FreezingDarkness
Yes, they have sold us out, but apparently some of them are too stupid to realize it yet!
Canadian Cop,
Your letter could not have been better – a great work. I am in the same position as you, and there are others here like us – born in the US but have lived our lives only as Canadians, only in Canada. I am also stuck in your option number four. I wish that I could believe your MP’s assurance that we have “nothing to worry about”, but I sure don’t feel that way. I definitely don’t want personal account info. turned over the IRS, even if Canada’s position is that it won’t collect for the US.
It is criminal what the US is doing to us and no one seems to care. I feel very let down by the Conservative government. I hate that the official government position is that we should be filing US tax returns, with no mention of how absurd and unjust that is – paying taxes to a foreign country where we’ve never lived or worked, a foreign government that has never given us any services or benefits. I also had written to Flaherty and Harper.
Please read the info. on possible relinquishing acts (other than renunciation) – there are good resources on Isaac Brock & Maple Sandbox, and very helpful people. As Pacifica suggested, your career in law enforcement may give you a relinquishing argument. It does appear that the best protection against a financial institution not reporting us is a CLN.
The IGA appears to have skirted around the privacy and banking laws that I had put some faith in. There is still section 15 of the Charter and I am ready to contribute to any class action lawsuit about our Charter equality rights being violated. There is also the hope that FATCA may be repealed but I’m not holding my breath. It appears to depend at least on how much power the Republicans can regain.
Green Party comment to me tonight:
“Really, there hadn’t been any domestic developments on this file since our early 2013 releases, so we didn’t have significant new points to add, which was part of what was delaying a new statement.
Now that there is an actual IGA text to work from, we can comment on that before the enabling legislation is drafted & tabled in the House.
Plus, having bills tabled will give our MPs an opportunity to speak on this issue in the House, or bring it up in Question Period.
Regards,
Erich.”
@Canadian Cop
One of the best letters I have seen.
This really brings the message across in a way that more people should be able to get it. Shocking and disheartening that the MP still doesn’t understand what’s really going on.
I too think you have a case for relinquishment.
I am a Canadian from birth but born in the US & came back as a child. I spent thousands on filing income tax (I mean to the accountant) & turned my financial life upside down for the sole end goal of renouncing. The US got more out of me from my renunciation fee than from any taxes. What a waste of dollars that should have been in my retirement fund. Hope you can find another way.
Ran across a case of another from birth Canadian who was born in the US. because his father was in the Canadian Military & was stationed in the US at that time. What a great reward for their service to Canada.
@Freezing Darkness & Bubblebusting –
Loved your comments. “that is to say, they sold you out, and now they’re trying to assure you that they didn’t, not really.” & “Yes, they have sold us out, but apparently some of them are too stupid to realize it yet!”
Isn’t that just the truth!
I think it might be easier and less costly for Harper and the banks to lessen all Cdns rights, rather than ferret out a few — just provide the IRS access to all Cdn govt data bases. Therefore you wouldnt be a second class citizen, just another 1st class slave…
Is getting a CLN based on a past expatriating act really the best answer? You have to identify youself to the State Dept with all sorts of details. They will then know where you are. Will they send that info to IRS? And IRS, as I hear it, may just consider you were a still US Person, if not a US citizen, until you reported the expatriating act. I know there are valid legal arguments for saying they can’t do that, but this whole “US person” business seems so deliberately nebulous.
Which will put a “relinquished” dual more on the radar? being reported by FATCA or requesting a CLN? What a nightmare.
But in the particular case of duals, especially those who presumed they relinquished when taking Canadian citizenship and those who are accidental Americans, never having done anything in the way of using their US citizenship, it just may be best for the moment to rely on the fact that CRA and the Canadian courts don’t collect for the IRS against Canadian citizens on their earnings in Canada while a resident of Canada.
WOW, Amazing development….Twitter to save the day???
Twitter says it is prepared to sue the Obama administration for the right to disclose more details about government surveillance requests.
Read more: http://thehill.com/blogs/hillicon-valley/technology/197646-twitter-considers-legal-fight-to-disclose-docs#ixzz2scp0nYz2
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@Petit Suisse, A relinquishment date prior to February 1995 is a virtual get out of jail free card. Before June 3, 2004, and one is free of the exit tax. I think the answer to your question depends on the date. Obviously if your date is after 2004, your exposure to the IRS is very serious, and potentially incriminating. This is why I wrote “FIFTH AMENDMENT” on my final 1040 and my 8854, on a few lines. Invoking privilege may spare a person from putting potentially incriminating evidence on the a Form. This is in my view preferable to putting down false information, which is considered perjury and a felony. See http://isaacbrocksociety.ca/2012/04/29/form-8854-fbar-and-the-fifth-amendment/
@Canadiancop Scott Armstrong is a complete LIAR! My wife and I have plenty to worry about. We have been calling around and are getting prices in the thousands to fill out paperwork and be placed at risk of losing our home to the IRS. Tell Scott Armstrong to Guarantee you low compliance cost and no possibility of fines or penalties and we will lose less of our life’s earnings to the USA. We are a SACRIFICE of the Canadian government. This is why they are saying this was the best deal. This is why I am saying anyone who came to Canada needs to be WARNED they have NO PROTECTION from the Canadian government if their home country comes for them. Canada will kneel down and give in and sacrifice them too. Actions speak louder than words. I wonder why all the fighting in Syria, likely because of a government like ours here…….
@NativeCanadian, we need to get the fucking US tax compliance industry out of Canada. They’re only business is to obtain a fee for collecting money from innocent Canadians for a hostile foreign government. That would be good start. You have very excellent points. Thanks very much for your participation.
@Canadian Cop: I encourage you to visit your MP in your uniform to say exactly what you have said here.
Because you were a police officer, you very likely signed an Oath of Allegiance upon joining a force. That could be grounds for relinquishing with a CLN backdated to that date.
WTF is happening to this country?!? Harper said he would change Canada. He kept his promise.
@Petros
Canadians needed strong, principled, Canadian leaders to keep out the US tax compliance industry, and instead of doing that, they’ve abdicated their responsibilities, and capitulated to the US government.
I just don’t know what to even say anymore. From my point of view, Harper wants me to wait another year to apply for citizenship, and if I’m lucky, I can only aspire to earning second class citizenship just because I wasn’t born here.
I’m just trying to wait for how these events continue to play out, but these days, I’m just feeling like I’m in the wrong country.
@CanadianCop
You likely have a get out of jail free card since you probably swore an oath of allegiance to the queen which is a relinquishing act.
I just sent this email to my Conservative MP Pierre Poilievre, Flaherty and Harper. I suggest others who have not yet done so to also let your MP as well as Flaherty and Harper know how you feel. Let’s make them sweat with a million emails in their inboxes, and a million letters on their desks.
The Canadian government’s announcement that it will capitulate to USA’s demands over FATCA was a sad day in Canadian history.
I am personally devastated that the country I have been a citizen of since birth (and my parents (and their parents) are also citizens of), has decided to throw me (and 100’s of thousands like me) under the bus simply because I was born in the USA. Apparently it doesn’t matter that I have lived my entire life as a Canadian in Canada (except for the first few months which is hardly something I had any control over).
To discriminate against Canadians based on national origin is prohibited in our Charter of Rights and Freedoms. The next step in the fight is class action lawsuits against the government of Canada for violating the rights and freedoms of a subset of Canadians. Rumour has it that our government, will be invoking the ‘not withstanding clause’ which allows it to circumvent the Charter of Rights and Freedoms under exceptional circumstances….like war. I guess it is war, when the big country to the south says bend over or else. However, the USA is just a bully, and like all bullies would back down if Canada had a spine and told them ‘NO’. Do you really think USA would have the nerve to make good on its threat to withhold 30% of all US sourced income to the banks if Canada had said ‘NO’? Many people, a lot smarter than me, don’t think so. Our banks could have worked with the government to apply sanctions at the USA in retaliation, but no they pretend they worked ‘furiously’ to lobby against FATCA (as the media says) but reality is they pressured the government to sign an IGA.
Its too bad our current Conservative government is lacking balls, principles and integrity. I will never vote Conservative again in my life, Neither will any of my family members, or any of the one million ‘US persons’ in Canada or their family members once they find out what the government has done, MOST OF THEM STILL DO NOT KNOW, and they won’t until their bank starts asking them where they were born….just in time for the next election. Personally I will vote for whichever party in my riding has the best chance to beat the Conservatives; this is the plan of action that I and my fellow US person friends caught in this mess are taking and advocating to others.
I am ashamed to be a Canadian, and cursed and ashamed to have been born in the USA.
Regards,
Kathleen XXXXX
@CanadianCop
> I’m just trying to wait for how these events continue to play out, but these days,
> I’m just feeling like I’m in the wrong country.
A common feeling, I think, now that Canada has become a petro-power with all that entails…
yet to be confirmed, but it looks like the cons have managed a hat trick – betrayal of sovereignty, a big slice of its citizens and the earth, all in one shot.
I often thought New Zealand would be a great place to retire… but then, well, you know…
But I guess it’s a self-limiting process – you can only throw so many people under the bus… at some point, the bus can’t move anymore.
@ WhiteKat
All good, but I wouldn’t get too enthusiastic about the next election – between this and TPP, I’m guessing that the smart money would go down on a early election call.
@FreezingDarkness,
Then we better get our butts in gear and inform as many people as possible about what the Cons have done to Canadians with ‘US person’ status.
@WhiteKat
Yeah, I wouldn’t be surprised in the slightest if the Conservatives used the ‘notwithstanding clause’ to quash all of the pesky lawsuits and Charter challenges that may come their way.
This is why I’ll be paying VERY CLOSE ATTENTION to the 2015 Federal election.
If the Conservatives happen to win the 2015 election with a majority, then I can only conclude that a majority of Canadians have chosen the sanctify the act of the Conservatives and their throwing other Canadians under the bus that just happen to be dual, regardless of the reasons why. But not only that, they’re also in apparent approval of Canada’s capitulation to the US, and even Canada’s complicity in singling out their own Canadians for US personhood, and then reporting them to the IRS.
If this proves to be what Canada is really all about, then I may as well remain a PR until my wife becomes too sick for me to take care of, and then, after she’s placed in a home, then I’m going to leave Canada. I’m not going to waste my time in learning the Conservative lesson on the ‘value of citizenship’ from a party of backstabbing hypocrites, just to earn second class citizenship, all with the end result of that to feel like a foreigner in spite of having a citizenship certificate. For me, it’s either ‘citizenship like every other citizen’, or no deal. If I am to be rid of US citizenship and go ‘all in’ for Canada, then it’s under the condition that I won’t be treated as a ‘second class’ Canadian. Period. Otherwise, forget it. I won’t bend on that issue.
There are other countries I could go to, and other challenges that I can pursue in search of freedom. Even if I fail in my task, even if my vitality leaves me because I did all I could to keep my wife out of the home, and I become too old myself to really begin again, then at least I know I’ve never sold my soul to anyone.
@Canadian Cop,
I thank you for your letter, it says what’s been racing through my head – especially since we got the news that we are second class citizens in Canada. Your perspective on the situation has added chilling reminders of just how unjust this craziness is…”FATCA is a classic “fishing expedition”, and I trust your government is not going to sign any Intergovernmental Agreement (IGA) with the US in an effort to deny me, and others in the same situation, the same rights afforded Paul Bernardo.” These words need to reach all Canadians.
@WhiteKat,
I couldn’t agree more, but I really think we got sold down the river for a pipeline. Harper’s roots and therefore money come from Alberta.
@all,
Like Canadian Cop I’m in a “#4” holding pattern. My mom always told me growing up that because Canada would not allow dual citizenship when I was born (late 1950″s) that she renounced my American citizenship when she registered me with the Canadian consulate. That made me a “Canadian Born Abroad”. If I wanted my right to American citizenship I had to notify the US when I turned 18. Of course I never did cause I didn’t want it! I am Canadian! My mom was a smart lady, a legal secretary so I know she knew what was what. I’ve always thought that I had relinquished years ago. I also worked for a short time for the government in either 1977 or 1978, still trying to confirm. Have I relinquished?
@whitekat… Within 1 hour of sending my MP a copy of your posting, he personally called me. He was told the deal was excellent and it has the banks off the hook and US expats are free of any problems. He said that the banks will report to the CRA who will only pass on info on US persons under our exsisting treaty with the USA. He is going to analyze this more and wants to hear of any and all loopholes in this deal… I will get busy as he is a Conservative and I want him to vote against it as it is a bad deal…
Yes, But the question is whether the USA thinks you did? And I do not think they do.
I wonder what the salivating tax compliance industry in Canada will think about this great news that USP’s are protected by the IGA? Maybe Calgary411 can get an opinion. This will almost be funny.