New York-born London mayor Boris Johnson refuses to pay US tax bill http://t.co/MaKDcZnTnM via @guardian U.S. London Emb won't pay con "tax"
— U.S. Citizen Abroad (@USCitizenAbroad) November 20, 2014
Read the complete article here.
It includes:
Boris Johnson has revealed that he is refusing to pay a tax demand issued to him by US authorities – despite previously lambasting the US embassy in London over its failure to pay the congestion charge.
The mayor of London, who was born in New York and holds a US passport as well as a British one, visited the country last week to promote his book and said during an interview with NPR (National Public Radio) that he had been hit with a demand for capital gains tax.
He said the US demand related to his first home in the UK, which was not subject to capital gains tax in England.
And for the absolute and total U.S. hypocrisy:
Johnson has continually pressed the US embassy to pay unpaid fines it has incurred for the congestion charge. The embassy has refused to do so, claiming the charge is a tax and therefore its diplomats are immune. During a visit to the UK by Barack Obama in 2011, Johnson reportedly asked him for a £5m cheque for unpaid congestion charges but the US ambassador intervened before the president could answer. By last year the amount the US embassy owed in congestion charge fines had risen to more than £7m, the most of any diplomatic mission in the capital.
@Blaze “@Calgay: Do NOT discuss this with Roy Berg! Discuss it with a Canadian lawyer.”
Just to clarify what you said. Make sure its a Canadian Lawyer who is not a US Citizen and is not admitted to practice ANYWHERE in the USA.
Call it FATCA for hiring a lawyer!! “Mr./Ms. Lawyer, are you or have you ever been a US Citizen/Person?”
Calgary, that additional information block you posted would make me find a local lawyer in a local firm maybe next door to your local bank.
Lawyers in the US are FOREIGN Lawyers.
@Bubbles, “Would the IRS have any jurisdiction over Johnson’s acting executor if they entered the US? I suppose, though, that they would be barred entry under the circumstances…”
I have come to the conclusion that a former USC weither documented or not, should avoid anything to do with the US at all cost.
In my former life many many moons ago, because a certain “Warsaw Pact” country considered me under its law to be a Citizen, the USG specifically advised me to not enter said country or even transit the airspace of said country.
@Anne Frank, I would guess that because under “THE MULTILATERAL CONVENTION ON MUTUAL ADMINISTRATIVE ASSISTANCE IN TAX MATTERS” the UK will not assist the US on matters of collection BECAUSE the US signed a reservation against the collection provision, that would simply be the icing on the cake of your prior argument?
@FromTheWilderness – Roger Cohen made the mistake of becoming a US citizen and joining the broken system. In fact entertainer Craig Ferguson made the same mistake and was taunted by a Brit on his show that Craig now has to pay taxes worldwide while Craig’s Brit guest only stays in the US on a visa and can opted out of US taxation.
@Don, I think Boris Johnson is the best thing to have happened to former/ex-pats.
Even if he pays up, he will be BITTER!!!
Weither he knows it or not yet, he IS on the path to relinquishment come next May!!!
In time, he will become our ally.
I am thinking I would long for the day of Prime Minister Johnson.
This article appeared in The Age newspaper (Melbourne, Australia) this morning:
London mayor’s unpaid tax bill shows why some don’t want to be Americans anymore
http://www.theage.com.au/world/london-mayors-unpaid-tax-bill-shows-why-some-dont-want-to-be-americans-anymore-20141130-11wzs3.html
Perhaps it it time to send letters to The Age about the effects of FATCA on ordinary Australians who just happen to have been born in the US.
George,
My exact thinking. Finding the appropriate Canadian-only lawyer to hold my will and be the executor of my “estate” will be a New Year’s resolution. There is only one at the moment that I would truly trust, but he is on the other side of Canada.
@calgary411
Easiest way to find the proper lawyer is to ask the one u trust to refer u to someone who can help u in your neck of the woods… because of this… I have little trust in lawyers or accountants because I feel that they are trying to scamming me… including some extended family who are in these fields… every time I talk to them… not about this situation… I hear… ker-ching… ker-ching… I am not rich but I have little trust in them
@Anne Frank
Thank you for another excellent post.
And I totally agree, there should be warning signs in front of US consulates and embassies, because truth in advertising does not seem to apply to the US government.
Far too many people have been tricked into joining the circus, when all they were after was a ticket to the show.
Polly you unfortunately don’t know what you are talking about.
MB nobody will be extradited from Canada to the Ststes for taxes . They can’t even collect them here
@Anne Frank
@George
@Polly
@EmBee
On extraditing Boris from the UK or Canadians from Canada:
To sum up and reassure EmBee (and me) about extradition, am I correct in these assumptions:
1. It is the conduct and not the name given to it that deterimines whether the two countries punish an act and consider it extraditable.
2.Britain and Canada do not punish their citizens for not reporting income earned in another country while legally resident there.
3.Therefore they would not extradite a US person for such behavior, regardless of whether both countries have a crime called “tax evasion “. In the same manner, if the US considered selling cafeine a serious drug offense, Canada would not feel obliged to extradite coffe sellers as drug dealers.
I would like to suggest a permanent thread on IBS entitled “IRS Collection and Extradition”. Even though the subject is often enough brought up here and there, it seems a lot of us are a bit lost in trying to distinguish what the IRS WANTS and what it can ENFORCE. A thread where we could read up on this topic would be very helpful.
Dear all
I am not trying to create mass hysteria here and I am also not talking about Canada. I have no idea about Canada and what Canada has arranged to do with American tax problems. I am talking about European countries. Not paying your taxes is considered a punishable and criminal crime everywhere except Switzerland. In Switzerland you pay a fine and thats it. No criminal charge and no jail time. It is a criminal offence in these other countries punishable by jail time. I am talking a british citizen who is not paying his taxes to Britain or a german citizen who is not paying his taxes to Germany – NOT to America. It is considered a criminal crime in these countries.
Seeing that Germany considers this to be a crime punishable by….whatever George said about jail and that punishment has to be considered criminally significant….BOTH countries consider it to be a crime, similar to murder being a universal crime. This means that Germany will extradite an american citizen who will not pay his taxes to America because that is considered a crime in both nations. I suspect Britain will do the same.
Having said that, I am wondering how much Boris`s understandable reaction will shed light on the absurdity and immorality of CBT.
@Polly: Speaking of “absurdity,” the National Post in Canada has finally woken up to that very fact.
http://news.nationalpost.com/2014/11/29/london-mayors-irs-bill-shows-the-absurdity-of-the-u-s-tax-system/
Why did it take a high profile Brit to finally wake up a Canadian publication when Canadians have been screaming for three years. National Post, through their Financial Post section, has mainly ignored us or urged us to get compliant.
It would be great if the US tried to extradite Boris! Think of the publicity. Ain’t going to happen.
@Polly, per the UK/US Treaty. First the offense must be an offense in both Countries.
“1. An offense shall be an extraditable offense if the conduct on which the offense is based is punishable under the laws in both States by deprivation of liberty for a period of one year or more or by a more severe penalty.”
Failure to pay tax is a civil matter not a criminal matter in the UK and the US.
Making false statements can be a separate criminal offense.
Failure to file in the US is criminal attracting possible jail, not so in the UK.
Failure to pay capital gain tax in the UK for the sale of a first home is not an offense under UK law because there is no tax to pay.
Making a false statement to HMRC that a property sale was a first time house when it was a second vacation home would be an offense possibly attracting jail time.
There is no comparable offense in the UK.
Secondly the question is where the offense was committed;
“4. If the offense has been committed outside the territory of the Requesting State, extradition shall be granted in accordance with the provisions of the Treaty if the laws in the Requested State provide for the punishment of such conduct committed outside its territory in similar circumstances.”
Is it a criminal offense for a UK Citizen non-resident in the UK to not pay capital gain tax on a non-UK home? Such a person has no obligation to HMRC for anything!
Boris’s failure to pay capital gains tax on a primary home occurred outside the USA as in Boris being outside and the house being outside.
There would need to be an extraterritorial UK law for the extradition treaty to take effect, which there is not.
—–
Lastly a UK Court and in my opinion a EU Court would seriously question as to why the US reserved/OPTED OUT of the collection provision of the OECD treaty on Mutual Collection?
The USA did have an open option and still have that option to OPT IN to have a foreign government assist in collections!
The USA would have to say with a straight face we did not sign the treaty with mutual collections which would have got us the money because we wanted to extradite people instead!
The USG gave up its option to get worldwide collection amongst those that signed the OECD treaty years ago.
But George- not paying your taxes IS an offence in both countries. It doesn’t matter whether in this case Boris didn’t own capital gains on the sale of his house in England. What matters is that taxes are not being paid, and that is considered a criminal offence in both countries. IF Boris owed taxes to England and refused to pay them- that would be a criminal offence in England.
Polly , you are being too literal and you’re not listening. Boris would have to be charged in the US. They aren’t that dumb. A US court would have to agree. A British court would have to agree. And so on.
Have you any idea of the cost? Think hundreds of thousands. Ain’t going to happen. The IRS has much lower hanging fruit to harvest.
@Polly, getting to the end of the year in either the UK or US, realising you did not submit enough in tax payments and then owing a balance of tax is NOT a crime in either the US or UK. The prisons would be bursting with people that owed tax. Thats why the USG and HMRC write off billions in uncollected tax each year.
There are many ways to get into trouble but owing tax and being unable to pay is not that kind of trouble. The authorities on either side of the Atlantic will persue civil remedies to collect which may include seizure of assets.
In order to be extradited from the UK to the US first there must be a criminal offense and second the UK must, I repeat MUST, have a UK penalty that is one year or more in prison. That is stated in the UK US extradition treaty.
What UK law did Boris break?
What is the UK penalty for breaking that law?
Does that UK penalty provide for prison one year or more?
@Duke of Devon
As I believe foo said, “they have smaller fish to fry”.
@Polly, here is another example that may help.
It is illegal for USC to purchase Cuban Rum.
The crime of purchasing Cuban Rum is so serious that the US can sentence you up to ten years in prison.
Would the UK allow an extradition from the UK to the US based on purchase/sale of Cuban Rum? No, because there is no corresponding UK law.
@Polly, “IF Boris owed taxes to England and refused to pay them- that would be a criminal offence in England.”
That is not true, it is NOT a criminal offense to owe tax in the UK and refuse to pay them. It IS a Civil matter, you will be taken to Court if you refuse to pay and a Court will order the seizure of assets. The tax will then be paid through the seizure but its not a criminal matter that you may owe a particular tax.
@George
Boris broke (intends to?) the law of refusing to pay his taxes. Regardless of whether he owes taxes in England or not- the ACT of refusing to pay your taxes is punishable in both nations. It isn’t about whether he actually owes taxes in England or not- it is about the fact that if he DID owe taxes in England and he refused to pay them- that this is considered a criminal act in both countries.
And I agree it has to do with amount of jail time that the offence would entail in either country. I too have heard that it has to be about a whole year in “jail sentence” for it to be considered an extraditable offence.
@Blaze
Everybody I talk to about this whole mess and CBT is appalled. They all think it is totally outrageous – not just Boris. I`m talking people of various nationalities. Nobody can really wrap their head around so much injustice, unfairness, and absurdity. It is truly incomprehensible that nobody does anything against it- starting with Tina Turner and all the rest who are being strangled by these inexcusable “laws” that are just an excuse to confiscate wealth from others that they have no real justification for demanding from them.
@Polly, “Boris broke (intends to?) the law of refusing to pay his taxes.”
For the sake of argument lets just start with the “Refusing to Pay Taxes Law.”
In both the UK and the US, you MUST pay your taxes.
In the US is refusing or unable to pay a criminal offense or a civil offense?
In the UK is refusing or unable to pay a criminal offense or a civil offense?
The answer is that while it is a very very serious offense, it is a civil matter and not a criminal matter.
Bad things will happen to you in either the UK or US.
The authorities will take you to court. Once the court has determined that you did not pay they will order that your assets be SEIZED. Seizure of assets is extremely serious but is not placing you in prison.
I assume he never filed taxes in the US. How come would they come after him or bother him with it?