Democrats Abroad has published a report of their four month study of how FATCA affects Americans. These reports have been sent to “selected members of Congress and senior officials at the US Treasury and IRS.” DA also indicates discusions with them are ongoing.
DA Report DataPack-CDNS top the list of respondents; 31.8% of those denied jobs due 2 #FATCA Senior Exec Positions http://t.co/6HNFnd4NZK
— ADCSovereignty (@ADCSovereignty) September 15, 2014
The report consists of the following (3) documents:
1. Executive Summary of 2014 FATCA RESEARCH PROJECT – “FATCA: Affecting Everyday Americans Every Day”
2. 2014 FATCA RESEARCH PROJECT – “FATCA: Affecting Everyday Americans Every Day”
3. 2014 FATCA RESEARCH PROJECT – Datapack
@Don There is a similar problem in the UK with regard to the Equality Act 2010, which prohibits discrimination against any UK resident on the grounds of nationality.
I told my Member of Parliament about the fact that National Savings and Investments now prohibits US persons from buying certain government savings certificates. He was surprised and thought this sounded disturbing. He sought advice from a government minister David Gauke, who replied
“As the administrative costs of reporting are considered disproportionate and not a good use of UK taxpayers’ money, NS&I is writing to customers affected by FATCA to let them know that we will close and repay the balance of their account(s)“.
To my mind this is like saying, because it is expensive to install fire extinguishers, this business is going to disregard legal requirements on fire safety.
I also wrote to the Equality Advisory Support Service (UK). Their reply was
I understand that you feel that the National Savings and Investments application form appears to be in violation of UK anti-discrimination law with regards to nationality.
After some research we have discovered that this issue would be an exemption under Section 22 of the Equality Act 2010, because FACTA is based on US legislation and the UK government have agreed to their rules and regulations. Basically what this means is that the Equality Act 2010 would not override FACTO (sic).
She actually made a few typos. She meant to write Schedule 23 (General exceptions) which says that discrimination on grounds of nationality may be allowed if this is required by other law.
I tried to reply that there is no other law that requires this discrimination. The UK-US IGA on FATCA explicitly mentions NS&I and says that many of its savings products are to be exempt from reporting requirements.
The UK government has trumpeted the IGA as a great success in negotiating with the US. However, it is not even making use of this IGA as regards its own conduct. Instead, it prefers place other UK legislation in a subservient position to US requirements. Analogous to the situation for Canada-US duals, a UK-US dual citizen and taxpayer is a now a specially disenfranchised class of UK citizen. It appears that our UK legislators have two things have been most in their minds (a) reducing costs for UK financial institutions, and (b) the allure that there will be reciprocity.
Kathy,
You can register to vote from abroad here:
https://www.votefromabroad.org/vote/home.htm
Thanks Don. So any non-resident USC who left the US (or never resided there) before registering to vote would not be able to vote in the mid-terms. Would they even be able to vote for a presidential candidate in 2016 if they weren’t registered?
I’m not voting (relinquished and yet to receive CLN) and have never voted in a US election, but it would be interesting to find out how a USC does it from abroad.
@Don. A further thought. These days EU law trumps German or UK law. So far as I know there is no EU-US IGA. Quoting from http://ec.europa.eu/justice/citizen/
“EU citizenship, conferred automatically on any EU national, brings with it a number of important rights. EU citizens are entitled to other rights including: …
The [Lisbon] Treaty also prohibits discrimination on the basis of nationality.”
I wonder if the present Commissioner for Human Rights – Council of Europe might be specially sympathetic to the plight of European-US dual citizens who are disenfranchised by FACTA. His name appears in the Federal Register’s Quarterly Publication of Individuals, Who Have Chosen To Expatriate, as Required by Section 6039G (05/02/2014).
Someone asked about voting?
If you are a US cit and ever lived in the US then, yes, you can vote. There is a story (perhaps apocryphal) that some US cits abroad use the deportation center where their families were sent before being deported as their last address in the US.
Go talk to the folks at the Overseas Vote Foundation https://www.overseasvotefoundation.org/vote/home.htm
I registered through them. Washington state allows me to vote for EVERYTHING (city, country, state and federal). They send me an email when my on-line ballot is ready and I just do everything on-line except the signature – I have to print the ballot, sign, scan it and then I send it via email.
From the American Citizens Abroad website:
“In addition, ACA was able to get a special provision inserted first in a number of Intergovernmental Agreements and then in the FATCA regulations, requiring local overseas banks not to discriminate against Americans if they want to qualify for certain types of favorable treatment. ACA is one of the few, if not the only, organization representing Americans abroad that has the expertise and working relationships to permit it to work on a technical level like this.”
A shot across the bow at Democrats Abroad?
@Ricard – Is the Commissioner, Nils Muižnieks?
http://www.coe.int/en/web/commissioner/biography;jsessionid=A2C3E228DAE8EF97D7D50EAF00211F8D
At the end of the day, if someone doesn’t contact this guy or start legal action, all the rights in the world are of no value unless people stand up for them.
Europe has been asleep on this issue, however, I believe EU courts would be more sympathetic towards a legal challenge against an IGA.
That’s a good point about the EU not having an IGA signed.
Also what are EU banks going to do if an IGA is struck down while at the same time the EU says EU banks must provide resident EU citizens a basic bank account regardless of their financial situation?
They won’t be able to send FATCA data and won’t be able to turn away the customer.
Bubblebustin, I asked the women we met with at Treasury about the clause and the fact that discrimination was in fact occuring and her reply was that, well, they weren’t going to pull any country’s FATCA compliant status just because there was discrimination against US persons. So I asked, OK, how do we make a complaint? She replied that we would have to go through the country first (competent authority, I think) and then if that didn’t work she wasn’t sure…
I was not impressed.
@Don. You can search for the answer to your question here:
https://www.federalregister.gov/articles/2014/05/02/2014-10139/quarterly-publication-of-individuals-who-have-chosen-to-expatriate-as-required-by-section-6039g
… but the answer is yes. But the topic is so huge, I hardly know how to begin a letter or what to say that would be most effective. I have wondered how a European equivalent of ADCS might be launched. Those answers I had from the UK minister and from the Equality Advisory Support Service were so disappointing craven to the US.
@Victoria
We certainly can’t be allowed to act as speed bumps under the FATCA express bus can we.
@Bubblebustin, Yep, that’s my take on it. We simply aren’t important enough to go to bat for and, silly me, asking those difficult questions about consequences and how to enforce the non-discrimination clause when it’s not being respected. No wonder I came back from Washington totally depressed. Maybe someone like Phil Hodgen could give us a better answer.
One thing to keep in mind when registering to vote and exercising the right to vote is whether or not your “home” state uses registration and voting as factor in determining residency for purposes of income tax.
Some states do not have personal income tax, so it’s not a problem, but most do and they have long lists of criteria that could render you liable on your income and they expect you to file and pay up.
Also, maintaining bank and other financial accountants, having a dentist, doctor, lawyer, accountant, brokerage that you use in additional to family members in a locale can be used to argue residency for tax purposes.
Keeping an active driver’s license and having a US mailing address can be an issue.
Of course, there are ways to establish that your “closer connections” render any or all of the above non-issues, but it would require compliance measures that could be a yearly thing.
Vote if you like. But do check out the different states to see that voting won’t entrap you.
I made particular note of Section 6 of this survey in which it is stated that 67.8% of respondents said they would take FATCA into account when they cast their ballots this November. I took that to mean that 67.8% of respondents (presumably all Democrats) are seriously considering voting Republican in the next election over this issue. If that is, indeed, what this means, this survey should hit Mr. Obama and his party right between their collective eyes. How can they ignore this?
@MuzzledNoMore
What percentage of those 67.8% will vote Democrat depends on whether the efforts DA has made are sufficient enough to address their issues. Also, I think someone wrote that something like 25% of voters always vote for the same party regardless of anything! I suspect that the progress that DA Is peddling with this survey will be enough to make a bunch of folks happy not to have to hold their noses and vote Republican. Ewwwwwwww!
@Ricard @Bubblebustin
The anti-discrimination clause in the IGA is narrower than it looks. The key word in the ACA statement is LOCAL. The IGA boilerplate says: “Financial Institution must not have policies or practices that discriminate against opening or maintaining accounts for individuals who are Specified US Persons and who are residents of the UK,” but it is in the section on local financial institutions. Allison Christians has said that the IGA non-discrimination clauses could be interpreted as only covering non-reporting financial institutions. http://taxpol.blogspot.co.uk/2014/04/netherlands-bank-prohibited-from.html . Is NS&I closing non-reportable accounts or just the reportable ones?
Lifetime cr*p units is about right. I read this today and thought of FATCA:
“An inquisition into every man’s private circumstances, and an inquisition which, in order to accommodate the tax to them, watched over all the fluctuations of his fortunes, would be a source of such continual and endless vexation as no people could support.” Adam Smith, Wealth of Nations, Book V, Chapter II, Part 2, Article 2.
The courts are probably the best bet, although I am not sure how much difference the Binckbank case made in the end. If we’re going to be run over by FATCA/CBT, we might as well be those spikey things that slash the tires of cars going the wrong way!
I am an independent, not a Republican or a Democrat. But one thing is for sure, I will vote Republican now.
Both parties have had plenty of time to take action for solving the problems of expats. But only the Republicans are actually doing anything. The Democrats are just playing games, with no intention of solving the problems. Shame on them!
@Ricard – Setting up a European ADCS?
First we would need to find some academics, discrimination solicitors, and journalists interested in the issue. It would be difficult to raise money without some legal/academic heavyweights behind the effort along with some free articles, TV & Radio not to mention social media.
Obvious a legal opinion is needed? Also which strategy would you want to approach? Find a country whose courts consistently rule in favour of the Government and get it to the European Courts? Or find a country whose laws offer a chance of winning at member state level?
I’m not a solicitor, but I would’ve thought getting it to European Courts would be better to get a European wide ruling.
Also lots of free help would be needed upfront. Affected dual citizens may be motivated to help with web design, and other IT help for example.
It’ll be a marathon not a sprint, but I’m sure you’d meet lots of interesting people along the way.
When the timing is right for me, I definitely will become more proactive than only blogging and speaking to the odd journalist who have run the odd article.
Regarding voting overseas in US elections check out https://www.overseasvotefoundation.org/vote/home.htm which is of assistance in filing the necessary forms to register to vote.
Here is the catch I have seen in California – if you register to vote under the federal law the fact that you vote as an overseas US citizen cannot be used for the purposes of proving ‘residency’ in the state for tax purposes. What LA County has done for years is send two ballots, the first is the federal overseas ballot (e.g. for US Senate, US Reps, US President) and a second ballot from LA County which includes all local and state initiatives, judges, state positions, etc. AND a certification that the person voting is a resident of LA County. This is key. California (like other states including VA) is very aggressive in asserting that if you have indicia of being a resident of California (i.e. you evidence an intention to return to California) you are liable for California income taxes. Indicia includes, voting in local elections, having a Calif driver’s license, etc. In other words, Calif sets a trap for the unwary – by just voting using both the ballots (not just the federal voter assistance ballot for overseas citizens) you are admitting you are a Calif resident.
As the Calif is firmly Democrat – I am not voting in Nov, but I have voted using the overseas ballot in the past. However, I would strongly recommend that if any of you (i) are able to vote without jeopardizing your ability to relinquish, and (ii) are registered in a state that has a US Senate candidate up for election then please vote for the Republican candidate because at this point that is our only hope to get the Senate in Republican hands and hopefully do something about FATCA and tax reform and Stop the Obama Administration from continuing this witch hunt. I have become a single issue voter.
FYI, I set up a blog tonight to try to capture some of my thoughts on the disaster that is CBT. The only thing that is there right now is an intro to me, but I’ll be updating soon.
http://fanaticbarf.blogspot.ca/
@ BillT
Clever anagram name for your new blog. I’ll certainly be watching for your updates. It’s quite a bad reflection on the US tax system that someone with your educational credentials and awareness of immigration and tax issues can make filing mistakes too. Even those who profess to be tax experts can’t negotiate that system accurately and we’ve had people writing at Brock who can testify to that.
Nice blog start, BillT:
Ha ha, yes, I’d say it is pretty much axiomatic that if you think complying with IRS rules while living outside the US is easy, you’re doing it wrong.
@ foo
We didn’t think of easy or not easy. Our mistake was to try to apply rational thinking to what we found out later is a totally irrational system. Didn’t work. You can’t push an irrational string with a rational finger.
French parliamentary debate on the legislation to implement FATCA is on the agenda THIS MORNING. You can watch it live here. Session starts at 9:30 and the FATCA law is #4 on the agenda http://videos.assemblee-nationale.fr/direct.html
@Ricard – One thought on the Equity Act, a firm of solicitors successfully mounted a legal challenge against some banks up in Cheshire using the Act.
http://www.manchestereveningnews.co.uk/business/business-news/blackstone-solicitors-hale-cheshire-now-6680833
It was done on grounds of racism. Under the definition of racism, national origin is included. A month or so ago I looked up the Government definition of racism and national original was in there. Perhaps you could Google it.
The banks breached the Equity Act. So I believe this could be a legal avenue to be pursued.
@Don Yes indeed, the UK Equality Act 2010 does deal with discrimination on grounds of nationality. However, this act can be trumped by other legislation and that makes it hard to fight FATCA by using the Act. As some have remarked, there is a clause about discrimination in the UK-US IGA but it is really just window-dressing. I seriously doubt it will ever have any practical effect. All it says is that exempt institutions (like a building society with only a local client base) must not discriminate against US persons, or otherwise their exempt status will be forfeit. Big deal! Those are exactly the FFIs who because they will have no cost of reporting have no reason to want to dump US persons. The IGA says nothing about sanctioning the more important class of non-exempt FFIs, for whom reporting is actually costly. So the anti-discrimination clause only applies to those FFIs for whom there is no monetary advantage in discriminating. Someone from ACA can please correct me if you think I understand this wrongly. But it looks like someone on the drafting team was being cute. “They want an anti-discrimination clause? OK, they can have it here. Hahaha”
That having been said, I did last week open an on-line bank account with Santander, a non-exempt FFI. I had to fill in lots of boxes about my citizenships and tax residencies status, and then they sent me a letter in the post asking for my country and city of birth, date of birth, US SSN and UK NINO. They included two full pages of fine print telling me all about FATCA. They call it a “law designed to tackle perceived tax evasion”. (I liked that they use the qualifier “perceived”) It made me feel “special”, burned a few LCUs, but was pretty painless. They even sent me a pre-paid envelope in which to return the form.