Can move this discussion further, after the little interesting budget thing in the Senate:
badger says
The FATCA-Mythspinning machine leaps into action:
http://thehill.com/blogs/congress-blog/economy-budget/237110-endorsing-tax-evasion
March 27, 2015, 03:00 pm
‘Endorsing tax evasion’
By Rebecca J. Wilkins
“..The U.S. loses an estimated $150 billion in tax revenue each year to tax haven abuse – a revenue shortfall that honest taxpayers have to make up. About $40-70 billion of that revenue loss is from individual tax evasion…”
.”To oppose FATCA is to oppose transparency and cooperation and take the United States out of its leadership role in combating tax evasion. The United States Congress is faced with a choice. It can stand for openness, transparency, and honesty – or for tax evasion, secret bank accounts, and subterfuge.
In the geeky tax world, we often refer to FATCA as FATCATS. It helps us remember the acronym. The FATCATS are the ones with those offshore bank accounts. Will members of Congress protect them? Or will they stand with American people?
Wilkins is the executive director of the Financial Accountability and Corporate Transparency (FACT) Coalition.”
Same old bullshit numbers pulled out of someone’s, er, pocket. And this deliberate lie makes me sick; “The United States Congress is faced with a choice. It can stand for openness, transparency, and honesty – or for tax evasion, secret bank accounts, and subterfuge.”
Right, that’s why the US Treasury signed IGAs that they have no authority to enter into, and why US banks do not and will not be providing EQUIVALENT RECIPROCAL information to other countries on all accounts held in the US. And why the US hasn’t and won’t sign on to the OECD CRS. No mention of the dirty secret of US extraterritorial taxation based on who your parent was or the geographic location where your mother gave birth…..
Let us remember those US resident homelanders who I am sure want a more transparent system – as long as they have the inside track on jiggling the rules for their own benefit:
ex. Take the Pritzker family trusts:
“……President Barack Obama’s nomination today of Chicago businesswoman and Forbes 400 member Penny Pritzker to be the Secretary of Commerce, her family’s legendary use of hundreds of offshore trusts to protect its wealth from taxes and the prying eyes of the Internal Revenue Service…..”……
http://www.forbes.com/sites/janetnovack/2013/05/02/pritzker-family-baggage-tax-saving-offshore-trusts/
‘Pritzker Trust Dodges Illinois State Income Tax’
http://www.forbes.com/sites/peterjreilly/2014/01/02/pritzker-trust-dodges-illinois-state-income-tax/
Plenty more material where that came from.
Yet, local legal everyday accounts in Canada – held where we live, to hold post tax wages, pay bills, save for education, disability, retirement, etc. are to be reported to the FINANCIAL CRIMES ENFORCEMENT NETWORK, because the US treats the education savings of a child in Canada with a US born parent as so much more likely to be ‘offshore’ assets belonging to a tax evader than say, the US resident owners of the family trusts like those of the current Commerce Secretary.
(hope you don’ mind being in the limelight, the discussion progresses to the next stage)
I saw the article to which you refer and I have to say I agree; it is merely nonsensical rhetoric and fanciful numbers.
I nominate Rebecca J. Wilkins for the IBS Hall of Shame.
I can only laugh and kackle in sheer disbelief. I can’t afford to do basic filings and I am a “FATCAT”. These people pushing this nonsense are pure subhuman scum. I’ll stop now before my head really explodes.
The usual propaganda- but its their push for their agenda.
They also want to keep the dems looking good.
Glad to see Hayden Perryman on this site. Hope he does not really believe that fighting FATCA is a lost cause … even though he seems to be profiting handsomely from it.
It’s the same old playbook, if you say something enough times it becomes fact even though the reverse is true.
Even if the $150B figure were true, will it ever be easy money to recover? With 7.5M ex-pats abroad that easily turns against the US Government, will fight them tooth and nail in foreign courts across 200+ jurisdictions, and will renounce (or divorce the US) if necessary, wouldn’t the US Government be better off concentrating on ‘easily’ collectible taxes?
The figure that seems more sensible is $8B over ten years or $800M per year which isn’t even a drop in the bucket to the US Government. It needs trillions not millions to get out of their financial hole.
@Don: Concur. And then there will be the destruction of the US “Effective Monopoly” on International Settlements which are now exiting stage left across the Pacific. The ramifications of this bad law will be a horrendous train wreck for the US (and any other country that hugs too closely to the US). The saddest part is that even if the US repeals FATCA next week … although the relief will be huge, the fundamental damage is already done. Many Billions have already been wasted around the world by Banks and Governments trying to get into a position to comply … people’s personal information is already being searched and stored … and may be leaked to who knows where … and other countries have determined that enough is enough and a New Chinese International Settlements System is now in test mode, the new AIIB replacement for the World Bank is a reality with new members streaming to sign on and a new BRICS Bank en train to replace the IMF. The US is behaving as if it is clueless just how far reaching the ramifications of these moves will be over the medium (1 to 20 year) term … long term, the US has messed up and will now have to play an outsiders game … Leadership has moved on … no shooting war required.
Nothing quite like the old progression from Lies to Damned Lies and then to the ultimate tool of deceit, Statistics.
Yes, pukekonz, it is for us sheer disbelief. Hang in there, friend. You have our moral support.
It’s the blatant hypocrisy that really gets me. The Financial Crimes Enforcement Network is after the meager savings of Canadian senior citizens instead of wealthy US bureaucrats with offshore investments.
@Muzzled No More
I second the motion to nominate Rebecca J Wilkins to the IBS Hall of Shame.
Two facts from Bloomberg.
The USA contributes 22% of Global GDP.
81% of Global Trade Finance is conducted in the US dollar.
So?
So, the US used up its three wishes on wine and song and went to sleep. The digital-dollar-genie however wasted no time leaving the bottle. Now, awake, disoriented, the US has turned to the smartest people they trust- the songwriters of the American Dream. Hollywood – and their Managers, Washington DC
You my friend have been DRM’ed by the by the US Government. Singing the ‘Song of America’ outside of REGION 1 is now a criminal offense.
Don’t think for a minute that they won’t throw you in front of a bulldozer like a pile of plastic CDs.
@LZ:
Contributes 22% of world GDP ? or consumes 22% of World GDP ? How much of that is Consumption, how much is Bureaucratic overhead and how much is real production ? How much derives from collecting commissions and Bank Fees from International Settlements transiting NY ? and how much from holding the World’s savings due to the Reserve Status of the US$.
As for the Copyright fees and so on … wonder whether China could claim to own the copyright on Gunpowder and other stuff … yeah I know … a little out of time …. but maybe China could invent NEW Copyright Law and insist on its force and effect worldwide … you know like some others push their own laws extra territorially.
@nervousinvestor The criticism is fair. I do present as if fighting against FATCA is a lost cause.
Do I really think that? No. Do I enjoy being a little proactive? Guilty as charged.
The analogy I would draw is that of a boat letting in water. Fighting FATCA is bailing out the water; addressing the CRS as well is part of fixing the hole. I believe both are necessary and I don’t think people fully apprecaite how advanced the CRS is.
Regarding the IGAs. Allow me to say that they are based on information flow to the U.S. by September 30. Whilst Canada and the UK will probably meet that deadline, many other Inter Governmental Agreement model 1 countries will not.
This presents a real challenge to the Inter Governmental Agreements.
Also, they are up for renewal by the end of 2016 – US reciprocity being a key factor.
Please don’t take me too literally, but the give the IGAs enough rope and they may just hang themselves.
If that happens but the CRS has not been addressed then defeat will have been snatched from the jaws of victory.
So no, resistance is not futile but not to recognise the threat of the CRS is to mistake activity for productivity.
A lot of garbage is written about FATCA, none of it is here at this website. I’m supportive.
When I see both the CRS and the IGAs tackled together and with the same vigour then resistance has a chance.
@Haydon Perryman : Thank you for your honesty in your response. I agree with much of what you say … GATCA (“CRS”), even though it is a mutually concocted Fabian style regime, is equally bad for the freedom of people world wide. FATCA is made worse due to the bad man, mafia style, threat of an offer that you dare not refuse 30% sanctions & cut off access to US$ Trading AND the complication of CBT. The US of course will never buy into GATCA due to the reciprocity issues.
There is actually an opportunity here for the US to reject CBT, FBARs, FATCA and GATCA wholesale and to come down heavy on the side of personal privacy and freedom to walk and to put its weight fully behind killing GATCA. IF (and I grant you it is a big IF) the world’s people can be convinced that the US repents that it has been on a sorry ride to nowhere, US offers to repay people, countries and Banks the money they have wasted on FATCA, the US MAY possibly once again be perceived as an honorable place and a safe haven. More likely …. I see vested interests continuing to seek to mislead the public in the US and the US becoming more and more marginalized in terms of the world’s economy over the coming decades.
Holland now also has joined the AIIB initiative. Good bye Obama!
What is emerging in the near future is the following. China is going to take control of the financial world nearer to its shores (Asia SE). The US will try to cling to its dollar world in North America.
However, I believe Europe, and the remaining BRICs will try to play both sides of the fence. Europe, Africa, and South America will be the new financial battlegrounds between the US dollar and the Chinese Yuan.
As I said earlier watch the commodities. When you start seeing copper, iron, food, and eventually oil quoted in both $ and ¥, the post WWII financial world order will have changed for good. Once that happens, the world no longer needs the US dollar solely to buy oil and the US will have to start living within its means. In other words, there will be a limit on the US’ national credit card for the first time.
@Don
There are people who say that the real reason for the war against Saddam Hussein was because he wanted to sell his oil for euros.
@Haydon Perryman in my view you are throwing up a bit of a smokescreen when you place FATCA and the CRS into one bucket. FATCA is definitely more vulnerable on constitutional and legislative grounds. The US has not agreed to CRS so that may be “dead in the water” in terms of the US. The CRS is advanced based on mutual and reciprocal agreement, FATCA is advanced based on extortion all counties of the world with severe nonreciprocal penalties for noncompliance.
Additionally the impact of CRS/GATCA on US persons abroad is in my view more benign. As mentioned the US has not signed up so will not get the data. And CRS is underpinned by supporting residency based taxation, so if you are resident in a country there is no need for your country of residency to report the information elsewhere. Plus as CRS does not involve draconian penalties for banks for noncompliance, or persons from noncompliance (maybe you may enlighten us further on this point), there would not be the discrimination aspects for US persons living overseas.
Haydon Perryman has not acknowledged the threats to FATCA by say ADCS and http://www.fatcalegalaction.com that FATCA violates The Canadian Charter/US Constitution. While Haydon acknowledges some flimsy tax evasion numbers underpinning Democrat support for FATCA, he does not focus on the cost of compliance side with more established numbers showing perhaps $25 in compliance for each $1 recovered by the IRS, nor is there acknowledgement of sovereignty violation and state sponsored extortion involved even of countries such as the UK, Canada, and Australia which are viewed as close allies of the US.
Haydon I point out to you members of the IBS community who have renounced US citizenship, who could have walked away from the issues of entrapment of US citizenship, but who are amongst the most vociferous supporters of liberty and justice for US persons overseas including opposing CBT, FBAR, and FATCA.
Let’s then jump to one of your countrymen Borris Johnson recently renouncing US citizenship and having been on public record for saying US CBT applied to him as being “outrageous.” Rumor is that Boris Johnson could be future PM of England and very much with the power to undermine US financial imperialism – including FATCA and other measures, with the extra motivation that the US has really outraged him.
Haydon you may think about this. FATCA may be removed the same way it came: tacked onto an unrelated bill and passed without debate. The Republicans have both the US House and US Senate and they have passed a party resolution to rescind FATCA.
Obama continues to upset Americans with his leftest agenda of ill-conceived Obamacare, lax immigration policies, and Muslim/Iranian appeasement. All increasing the odds of a Republican President in a year and a half.
Another route of FATCA demise. As it has not been passed by the US Senate it may be considered an Executive Agreement. To continue to be in place the Executive Agreement would need to be renewed by the next president. Without renewal it is gone.
This is the best article I have found on dealing with Obama Executive Actions:
Read more at: http://www.nationalreview.com/article/415104/gop-senators-open-letter-iran-first-step-andrew-c-mccarthy
The article suggests it important for the US Senate to pass a “Sense of the Senate” resolution against FATCA. The importance of this is to counter: the “international-law game” where an agreement is approved by other countries, which start acting on the presumption that the president’s signature binds the U.S.
FATCA R.I.P !
@Haydon Perryman I am interested in your view of the workings of FATCA for “recalcitrant” non US persons. I spoke with an Australian only person who received the FATCA form and would not sign and to put his viewpoint as “recalcitrant” would be ‘putting it mildly.’
While there is assumption with FATCA that certain numbers of recalcitrant US persons would not sign with 30% witholdings to be applied to them, there is nothing about and no penalties for nonUS persons not signing those forms. FATCA requires forms for 100% of account holders with larger value account prioritised. So for banks to meet this for recalcitrant nonUS persons then they would have to shut those accounts down. Yet will they do that?
FATCA IGA’s do not require shutting of nonUS person accounts and banks would not want to do that. The transfer of nonUS person financial information must be considered violation of their privacy. Australia privacy regulation was changed for FATCA with a clause saying waived “in case of international treaty.” Yet the treaty does not cover nonUS persons. Banks could do extra checks to determine US personhood of nonUS persons yet this is extra expense and not specified/required in the IGA agreements. So with any 30% witholdings banks would be at risk of violating privacy laws for any nonUS persons and also liability of potential wrongful 30% witholdings. The taxpayer advocate points out that there is no dispute mechanism in place to dispute wrongful 30% witholdings. That would leave the banks in the potential ‘legal firing line.’
@Haydon Perryman, I am a former USC having relinquished.
I appreciate you coming to this board now and then as it shows your humanity with our plight.
In regards to you making money off FATCA, I sense you are the type of guy who will make money regardless and you are not a FATCA one trick pony.
The anger on this board partly stems from overzealous compliance agents.
I for one say follow the law exactly as written no more and no less.
Asking the place of birth question for one is in my opinion going to get a FI sued in the EU with a resulting large settlement . It is an ultra vires question……..
Anyways your non-provocative attitude here is welcome and encouraging.
I do wish you well.
Oh, on GATCA I think its great and the USA is an ass for being against it. Regardless the chickens will come home to roost.
This is a good dialogue.
Interesting.
One person proposes I’m putting up a smoke screen with mentioning the CRS.
Another points out Place of Birth.
Brilliant points, even better that they are made in the same thread.
CRS entrenches place of birth and is left completely unopposed as we talk about FATCA.
Meanwhile CRS gets more and more advanced.
Isn’t this evocative of how FATCA was passed? Tucked away as Title V of the HIRE ACT? The HIRE ACT was passed by a thin margin and very few were even aware of Title V (aka FATCA).
Would the HIRE ACT have passed had they realised in contained a Chapter that would have become FATCA?
So what does this have to do with the CRS and why do I draw a parallel?
Who started the CRS? The U.S. They did it in two ways.
First, and most openly, with FATCA itself.
Second, and more subtlety, by committing the Inter Governmental Agreement country in the Inter Governmental Agreement itself to pursue a Common Reporting Standard.
So the US gets the rest of the world to form the CRS, while sitting on the OECD panel that shapes the CRS whilst facing no opposition because:
a) it has distracted everyone with the U.S. version of FATCA,
b) no one sees it as a threat from the US because the US cannot reciprocate.
Meanwhile the U.S. is shaping the reporting platforms and schemas for CRS reporting.
Am I alone in thinking we are being played?
Is it possible that the US could redefine ‘reciprocity’ in the context of the CRS?
Can the US control the narrative on the CRS? Seems to me like they already are and most effectively.
The withholding under FATCA was simply a stick for the rest of the world to comes up with the CRS.
What withholding? In terms of GDP most of the world has signed an Inter Governmental Agreement with no withholding.
USD 879 over 10 years? Rubbish; but its a useful distraction from things that matter like the CRS.
It is correct that FATCA created GATCA. Svein the snottie little German Greenpartier said it that “we should be thankful to America for bringing us FATCA” That it reinvigorated the GATCA work that had been stalled for 10 yrs.
https://www.youtube.com/watch?v=zRoU-JNFhr0
Haydon, I think you told us once that GATCA, even though it is meant for RBT, also demands birthplace (even though it isn’t useful for it). GATCA has so much gobblydeegook in its explanations that it is impossible for a layperson to research it.
ps.
The Same Country Harbor proposed by DA could have simply been achieved by eliminating FATCA and going over to GATCA. But Joe Green doesn’t have the intellectual capacity to grasp that.
CRS will allow for anybody’s data being sent to anywhere based upon suspicion factors not controlled by courts. I wonder what Sweden will do with the thousands of data points it receives from every country of the world about their citizens Anders Svensson and Sven Andersson . And how they will process the accounts of all the citizens named Mohammad and all of its different spellings in however many alphabets.
@marktwain. You guys and gals on IB are extremely well informed.
Yes, actually work on “GATCA” has been going on at the OCED, US and EU for several years.
The thought leadership was already advanced but it’s was not making its way to inception.
So yes, it’s genesis was not American, or at least, not American alone.
Sneaking it in Title V of the HIRE Act took it from an idea to a reality.
To your point on PoB, yes, that is a required field for the CRS. It is for matching purposes. Or at least that is the ostensible reason.
This is a real threat. Here is the UK we have already presented enabling legislation to the House of Commons.
If history repeats itself Canada will be next, but we will all be arguing about FATCA and won’t notice.