It is also important to note that FATCA’s requirements are the same for all American taxpayers—expats are treated no differently. All citizens are required to comply with United States’ tax laws and FATCA is a tool to enforce them. Tax evaders should rightly worry that FATCA will reveal their illicit activities.
Mark J. Marzur, Assistant Secretary for tax policy, United States Treasury Department (emphasis mine)
FATCA hunts down “US taxpayers” as defined by US law, considers their legal activities in Canada carried out as Canadian citizens as illicit, and then tells these “US persons” that they should be rightly worried about their “illicit” activities. No, Mr. Assistant Secretary: You don’t have clue. You must go back to school and study international law: (1) The Master Nationality Rule says that every country has the right to consider their resident citizens as only their citizens and not the citizens of any other country; (2) the Dominant Nationalty Rule says that a so-called dual citizen has the right to protection of the country with which they they have the most ties; and (3) The Rule of State Nonresponsibility that a state has no right to protect a citizen–or steal from them–if they are currently inside a country in which they have citizenship. FATCA conforms to none of the international rules of dual citizenship.
By completely disregarding the international doctrines of dual citizenship, the United States is a rogue nation, forcing other countries to “out” instead of protecting their own citizens.
The above statement of the Assistant Secretary raises a serious moral issue. If US Treasury wishes to ignore international law, then it is the United States which is involved in the illicit activity, not innocent Canadians who live in Canada and carry out their activities under the protection of the Canadian government (or the citizens of any other country for that matter). The immoral SOBs are not the accidental Americans–people whose only failure was birth in the United States–but the United States for taxing them.
The end result of immoral activity by the United States is war. We now see wars around the globe that the United States has instigated: Syria, Libya, Iraq, Egypt, Ukraine, and Israel/Palestine. The US is funding terrorists and neo-nazis in these various countries and it is causing instability, war, and death. FATCA is an extension within the financial realm of US imperial policy. It is financial terrorism: Financial American Terrorism Contra All.
If my bank accounts are “foreign” to the US, doesn’t that make the US government “foreign” to me? You are totally right, Petros. It’s time our Canadian government stood up for our rights.
Thanks for the common sense post, Petros.
Canada and other countries’ governments are no better, abdicating their moral and legal responsibility to protect ALL people of their countries. They had the tool of international law to back them up and ignored that to bow down to U.S. and allow foreign law to override their own countries’ laws, blind to ‘what might be wrong with this picture’.
I agree with LivingToRenounce that our bank accounts in the countries in which we live are not foreign to us — foreign is the U.S. government that has made our banks and other financial institutions arms of the IRS.
@Calgary, LivingToRenounce: exactly right. The leaders of a sovereign nation not only can but must protect its citizens. It is their first duty. Protecting the country and its citizens is never comes second in any implied mandate of a government–it is the first mandate. Therefore, if Stephen Harper cannot or will not protect the citizens of Canada, he has abdicated from power and placed, through a coup-d’etat a foreign government in charge. It is likewise immoral to do so: sin is not merely the doing of wrong things, it is the failure to do what is right. In this regard, Stephen Harper has both done bad things (he has ceded sovereignty to the USA) and failed to do what is right (he has failed to protect the citizens of Canada).
It also makes Stephen Harper a vow-breaker: http://isaacbrocksociety.ca/2014/02/18/the-singing-of-o-canada-is-a-formal-declaration-of-allegiance-to-canada/
Does Stephen Harper stand on guard for Canada or does he send the financial information for Canadian accounts of Canadian citizens to the IRS, a foreign hostile power?
Could Stephen Harper or any of his in lock-step Conservative MPs comprehend your rhetorical question, Petros? Or, do they completely understand it but have their marching orders from Congress?
As always, Petros, you have nailed in a fashion that makes it crystal clear how off the rails the US government is presently. How ironic that we who left the US and are resisting this tyranny have much in common with the original colonists who risked it all to gain their freedom 2 1/2 centuries ago.
So even though many of us are no longer US citizens we are still very American (in the best sense of the word). Funny how we really believed all that freedom and liberty stuff in school; now because of it we are “illicit tax evaders”.
Mark Marsur belongs in the same jail as Robert Stack for perpetrating this crap.
Treasury Department speak with forked tongue.
Slides on the difference between GATCA and FATCA:
http://haydonperryman.com/2014/07/25/slides-fatca-vs-gatca-aeoi/
Podcast on the same:
http://haydonperryman.com/2014/07/25/2nd-attempt-at-gatcast-5/
This letter simply confirms that USA is a global police state. Laws are not morals. Exactly the opposite.
All Wars are Bankers Wars
Oh Petros – so perfectly expressed! This commentary definitely should be sent to some of the journalists, both here and abroad (including inside the USA), who have shown helpful well-understood interest in FATCA and the situation of citizens of other countries who are being deemed “USCitizens”. 1000 thank yous (and a few hugs too) for explaining this vital technicality so clearly.
@Haydon Perryman: I’m reading the “Difference between FATCA and GATCA” on the website you mentioned – – the highlight so far (on pg 10 of the slide show): “it is based on residence and unlike FATCA does not refer to citizenship.” Should we cheer? Will the US demure to the rest of the world next November?????
@Petros. I think that you are a few years ahead of me on understanding of these issues. The focus of your post today was on the unreasonableness of U.S. law in particular FATCA. The focus was on the U.S. However, some of the same rules may be applied to the Canadian government in its lack of defending Canadians against US extraterritorial law.
There could be some chronology of this including the Canadian-US tax treaty acknowledging US law to tax and regulate Canadians resident in Canada, and change their law whenever they feel like it without challenge from Canada. Then more egregious is FATCA and IGA where Canadian law then is the reporting on USP to the US Internal Revenue Service.
In regards to the Canadian-US tax treaty, perhaps the legal review of this was if Canadian law was in compliance with U.S. law. While this was needed, the more relevant legal review should have been on those Canadian residents impacted and how the treaty would impact them, perhaps on a low, mid, and high income scenarios with varying levels of assets and over ones life time. This is what should be done now to help support a revision of the treaty to exclude from US taxation the family home, life insurance payout, retirement and tax advantageous funds, mutual funds, outrageous non compliance penalties etc.
I am thinking that movement on the Canadian-tax treaty might be an easier course for the government than upending FATCA requirements. And I am thinking that a successful ADCS challenge could spark a review of everything “on the table” including the Canadian-US tax treaty.
Re Mazur’s deliberately disingenuous choice of wording;
“..it is also important to note that FATCA’s requirements are the same for all American taxpayers—expats are treated no differently..”…
And, as we have noted before – and which Mazur knows full well – his specious claim of ‘equality’ of treatment (an ‘equality’ which I do NOT believe deemed USPs ‘abroad’ actually receive) does not justify INEQUALITY and INEQUITY of result. He claims that “expats are treated no differently…”. He and the US will stop at nothing to rationalize taxing us as imaginary US ‘residents’, deeming and penalizing and inventing ways to confiscate our local accounts – which the US – in the person of Mazur and his kin conveniently deem to be ‘foreign’ – because like other ordinary people we hold our legal LOCAL transparent, already-taxed wages and savings down the street from our homes, instead of inside a foreign country – the US – to which we have only a largely symbolic, tenuous or externally imposed and enforced relationship.
Treasury is just desperately trying to cover their tracks regarding the increasing slippage of their cover story re the OVD programs and the source of the revenues they extorted via FBARs – for even miniscule actual DOUBLE extraterritorial US taxes assessed from minnows abroad. I won’t say ‘owed’, because I believe that we abroad with NO US economic connection and no actual US residency do not ‘owe’ the US even the time of day – much less the full course banquet it seeks to extort for free from us abroad and the countries we live in and are taxpayers and citizens of – like Canada. The US signals that it is adamant in inventing new ways to extort taxes and penalty revenue from those who have no substantive US relationship. No matter what we do, the US can come up with new ways to tax those abroad – like the newest Obamacare tax on investments – which the Canada US tax treaty does not address and which those subject to it cannot get Canadian tax credits for paying. It’s rigged. And Mazur knows it.
@Badger
Mazur’s words did little to redeem the US’s position on how they choose to tax their non-residents with this statement – no one on their right mind is going to think that non-residents are the same as residents and the that there should be no consideration of the fact that the citizen is living outside of the US. The US is the outlier (and liar) here, and the rest of the world knows it.
Watching a movie that shows just how sneaky and underhanded the United States was.
http://youtu.be/9PMnlnqRex4
This is a three hour movie on YouTube…was originally shown on CBC called “The Arrow”. This is a prime example of showing that what the United States wants, it gets…and in this case…the brain drain from Canada of the Canadian Aerospace Industry. All the more reason why Canada should sever its ties of trade with the United States. For as long as we are tied to them by a tether, we will go economically down their road. FATCA is but yet another symptom in the disease that is US/Canada international relations.
@The Animal
In case you are curious, our old and deceased friend, Don Whiteley, worked on the Avro Arrow. That is why his moniker was “Arrow.”
How we miss his wisdom here.
Tim, thanks for that interesting fact regarding Don Whiteley / Arrow! How we miss his wisdom here.
Yes, thanks, Tim. I didn’t know that about Arrow.
I wasn’t aware of Don’s connection to the Avro Arrow. Yes, we definitely miss his wisdom here and his fight for all of us.
@bubblebustin, the fact that Mazur issues such a statement makes him sound defensive. Why answer thus unless a significant issue has been raised? US exceptionality and the imaginary US ‘residence’ and citizenshipbasedtaxation of those the US is forcibly claiming ownership of abroad will be necessarily be thrown even more in relief as the OECD efforts get more coverage – due to statements that clarify that the US (and Eritrea) stand alone in demanding tribute from people abroad, who have no economic connection or actual residency to justify assessing tax on.
Reminds me of Mythter Stack’s efforts, and the threatening statements regularly issued by Geithner and Shulman over the last few years.
Hello,
I work in a European bank in Europe. Recently we got circularised about the impending Russian sanctions, what we could no longer trade. Included in the memo was the line (I paraphrase) “If you are a US person, in the largest extra-territorial sense, then you must be really careful.”
(comment restored by Petros).
Something that ties into this. There are at least two agencies to the south that require a loyalty statement of anyone who has clinging citizenship of another country.
I do not want to put a direct link, that just seems like a bad idea, rather google “united states loyalty statement dual citizen.”
With one agency the form has a statement that specifically requires that you do NOT exercise your obligations as a citizen of ______________. So the place to the south is telling its employee and requiring them that they do not exercise any of their obligations.
Suggest that ADCS locate this document and add it to the file…..
“I must agree that I will not exercise my rights, benefits, privileges, or obligations as a citizen of
_________________________________________ while employed by the (INSERT ALPHABIT SOUP NAME)I.
@EuropeanBanker
What does that mean exactly? “Must be really careful”?
@Polly
I think that European banker is implying that they will start going after ‘U.S. persons’ who are trading in Russian securities, even as employees.