UPDATE: JUNE 14, 2015
from JakDak:
The Senate Finance Committee chairman, Senator Orrin Hatch (R-UT), has established working groups to study different aspects of the tax system. These working groups are scheduled to report back to the committee by June 26.
Tax Policy Update
June 09, 2015[Interesting: NUMBER OF THE WEEK: 61. The number of countries that have signed on to implement the OECD’s multilateral agreement for the automatic exchange of tax information, in conjunction with the ongoing Base Erosion and Profit Shifting (BEPS) project. Although the U.S. has committed to implement the standard, it has not yet signed onto the formal agreement (the “multilateral competent authority agreement”), which lays out in detail what information will be exchanged, the timing and method of exchange, and how signatories will work together to ensure compliance. Signatories to the agreement will begin exchanging information as early as 2017. Additionally, the OECD released on June 8 its “Country-by-Country Reporting Implementation Package” developed under the BEPS Action Plan. Under the plan, which the Treasury Department has said it will implement for the 2016 fiscal year, multinational companies are required to aggregate and report information annually regarding where they do business, the global allocation of income, and amount of taxes paid, along with other information that will allow taxing authorities to more closely examine multinationals’ tax practices. The release of the package coincides with the 2015 OECD International Tax Conference in Washington, D.C., this week where OECD representatives are expected to review and discuss key initiatives under BEPS.]
SPOILER ALERT: Comprehensive Tax Reform Unlikely in 2015. In an interview last week, Senate Majority Leader Mitch McConnell (R-KY) outlined a busy legislative agenda between June and August recess: passing a highway bill, cybersecurity legislation, No Child Left Behind, and the Toxic Substances Control Act. Tax reform, however, is conspicuously missing from the list. “We’re certainly not going to be able to be doing big, comprehensive tax reform with this president,” McConnell said. Tax reform optimists have been eyeing the highway reauthorization bill as a potential vehicle to move a limited set of tax reform measures, but according to McConnell, the bill might instead be better suited to pick up a different legislative passenger—the reauthorization of the Export-Import Bank. McConnell believes the highway bill would provide the best opportunity to reauthorize the bank, which is set to expire June 30.
The inability of the Senate Finance Committee Tax Reform Working Groups to meet their original May 31 deadline to report recommendations to Chairman Orrin Hatch (R-UT) and ranking member Ron Wyden (D-OR) only adds to the general pessimism. The international tax working group may offer the only glimmer of hope, with reports that it has made the most progress in hammering out detailed recommendations. The working groups are now aiming to deliver their reports before Congress departs for the July 4th recess.
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UPDATE: MAY 25, 2015
Em’s comment to JakDak:
I’m not sure of the where for the SFC recommendations but the when has been delayed:
http://thehill.com/policy/finance/242916-senate-tax-reform-groups-get-more-time
The Senate Finance Committee’s leaders are giving tax reform working groups some more time to formulate their recommendations.
Finance Chairman Orrin Hatch (R-Utah) and the panel’s top Democrat, Sen. Ron Wyden (Ore.), had hoped for recommendations by the end of May.
But in a statement Thursday, the two senators said that the working groups made it clear that they needed extra time to do the job right. The panel will set a new deadline after lawmakers return from next week’s recess.
“It is our hope these bipartisan working groups will use this extended time to finalize their recommendations for tax reform and produce in-depth analyses of options and potential legislative solutions,” Wyden and Hatch said in a statement.
etc.
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Shadow Raider says
April 29, 2015 at 6:39 pm
The Senate Finance Committee just released the comments sent by the public on tax reform. As expected, there are lots of comments about CBT and FATCA.
http://www.finance.senate.gov/newsroom/chairman/release/?id=3b14e94b-69f9-41e2-9fd3-7d191971b7ee
Hatch, Wyden Release Public Input on Bipartisan Tax Reform
Over 1,400 Submissions Made to Working Groups
WASHINGTON – Finance Committee Chairman Orrin Hatch (R-Utah) and Ranking Member Ron Wyden (D-Ore.) today released over 1,400 submissions from stakeholders on how to best to overhaul the nation’s broken tax code. In March, the Committee sought input from the public in an effort to provide additional data and information to the Committee’s bipartisan tax working groups, which are currently analyzing existing tax law and examining policy trade-offs and available reform options within each group’s designated area.
“We thank the stakeholders and public who provided us with this valuable data and input,” Hatch and Wyden said. “These submissions have equipped us with the ability to better evaluate how reforming the tax code will affect both American families and business of all kinds. As our bipartisan groups work towards producing substantive recommendations on how to reform the tax code, they will now be able to consider these valuable ideas.”
All comments received by the Committee that met submission requirements were made public.
Submissions can be found below. Total submissions to each bipartisan tax working groups are as follows:
Individual Income Tax – 448
Business Income Tax – 332
Savings & Investment -128
International Tax – 347
Community Development & Infrastructure – 207
Each of the five bipartisan working groups is currently working to produce findings on current tax policy and legislative recommendations within its area, with the goal of having recommendations from each of the five working groups completed by the end of May.
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Thanks, Shadow Raider, for alerting all here. There will be many Brockers reading, starting with the submissions (not all by individuals) to International Tax.
The submission by Margaret Moody is “interesting.”
She is taking the attitude that USC is precious.
… and Dave’s PS. “on a personal note” is worth a read too!
http://www.finance.senate.gov/legislation/download/?id=627fdf3b-fc34-4eb4-a467-3056449ecf6d
@Barbara
The industries that benefit from CBT are already at the table when it comes to policy making. I am sure that the U.S. mutual fund industry and the tax accountants probably have some very high-powered lobbyists on K Street or perhaps even their own dedicated government affairs people. They don’t need to write to Congress. They can sit down with these people at evening fundraisers.
Many of the financial service industry’s motives are not honorable and they would not want them made public. I have seen a few web pieces in which the financial services industry has touted FATCA as a great opportunity for mining client data from the FBARs or for basically milking people who are trapped in overly complicated U.S. tax rules.
Then there’s the revolving door: BNY Mellon, which has benefited massively from FATCA because of all the wealthy Asians with U.S. citizenship or greencards gave Shulman a plum job. The Isaac Brock Society is never going to do that. If you were earning a public-sector wage at the IRS, I am sure that making the rules more complicated with an eye to your future earnings would be tempting.
where’s that 1099 he promised?
http://youtu.be/PMEInTNsacg
@Orwell
That is from 2009.
@Barbara
Here’s the antidote for any feelings of euphoria you might have. This contributor proves that you can take the citizen out of the home land, but you can’t take the home land out of the citizen. This guy is right out the DA playbook, and then more!
http://www.finance.senate.gov/legislation/download/?id=e8aaf751-1841-402b-9c5c-c8d8aa11ff9f
I agree with foo and Publius that there are many who are satisfied with the status quo and therefore don’t have the compulsion to “reform” anything, but that’s not to say what you’re saying isn’t true! When I saw Bernard Schneider’s contribution, I half-expected to see something from Michael Kirsch, but realized he’s already got what he wants without having to shine a light on some of the inadequacies that even he realizes exist under the current CBT regime. I suspect that the compliance industry may be silent for the same reasons. Their general consensus may be “why rock the boat?”.
link changed to correct link per Bubblebustin’s 11.50 comment below
@orwell
Agreed – Dave’s is a good one. I have to shake my head how the US would create such a clear and present danger to non-resident US persons through FATCA. How the real possibility that our sensitive data could fall into the wrong hands doesn’t warrant an immediate injunction boggles the mind.
Am trying to read through the International Tax submissions. And relevant ones may be under Individual Tax too. Some really powerful ones so far. So many submissions. And how many other silent people abroad are they representative of, with the same or very similar or even grimmer scenarios?
We know that the US already knows enough about the burden on those abroad to see the wrong they are doing to those outside the US. They are already demonstrating that they are ‘willfully ignorant’, but these submissions are a record of further attempts to tell them of all the many permutations that cannot simply be eliminated by some tweaking – the kind of half assed ‘fix’ that they and other CBT proponents are likely to propose IF they propose anything at all. CBT is rotten to the core. A few nails and ducktape can’t fix that.
Treasury wants PROOF of bank accounts being closed or denied to those abroad. Actual redacted forms and letters (which I consider mere delaying or diversionary tactics – placing the onus on the victims). After speaking with them this spring, the DA says:”Treasury has the authority to implement FATCA Safe Harbor without the need of a legislative amendment to the act ‟ take-away offered by Deputy Assistant Secretary of the Treasury – International Affairs Robert Stack Key Take-Aways
13. slide 13slide 13 Address Treasury 1. Convince Treasury Safe Harbor is an effective Policy Adjustment 2. Provide evidence financial closures/refusal of new accounts are a result of FATCA legislation 3. Demonstrate Safe Harbor will result in resumed service by foreign financial institutions to American clientele. Action Items
14. slide 14slide 14 We Need Your Help Evidence account refusals linked to FATCA Send redacted copies of bank communications (e.g. letters, emails, policy statements) that document a link between the bank’s rejection of U.S. customers and their obligation to comply with FATCA.
15. slide 15slide 15 We Need Your Help Evidence account refusals linked to FATCA Send redacted documents to FATCA@democratsabroad.org (If you already sent documents before the July 2014 FATCA implementation date, please consider sending documents that followed this date) Spread the word about our need for this information ”
Well, Treasury and Mythster Stack are already deep into ‘willful blindness’. The onus is on government not to harm those they claim as citizens, NOT on the citizens. Treasury and Stack exist to serve citizens and taxpayers and residents, NOT the other way around. WE do NOT exist to serve the US Treasury and Mythster Stack.
US expats abroad need someone to take them to task now, in 2015, like Carolyn Maloney questioning Geithner back in March 2012. Eric posted the video clip that Just Me found of the exchange and posted a transcript http://isaacbrocksociety.ca/2012/03/24/head-of-americans-abroad-caucus-questions-geithner-about-banking-issues/
That was THREE years ago. And Treasury still wants PROOF of FATCA harm. They’re stalling.
Justice delayed is justice denied.
As I go (from the bottom up) I’d like to highlight the submissions that address some points sometimes overlooked:
CBT is completely oblivious to the its effects on the delicate tax ecosystems of other countries:
http://www.finance.senate.gov/legislation/download/?id=475058f4-7900-4def-b60f-04c97a48da93
The injustice to taxpayers when the tax compliance industry can lobby against tax reform:
http://www.finance.senate.gov/legislation/download/?id=59060f43-4764-4d7a-9493-cd7346d5b6c4
This lawyer was envious of her Canadian husband when Canada didn’t stalk him after they both moved to Mongolia:
http://www.finance.senate.gov/legislation/download/?id=cee30c18-2353-41be-ad84-e70566a8d4fa
By the way, I didn’t meant to include an active link above to the Democrats Abroad email. If you want to provide redacted documents of your banking denials, then fine. But I didn’t refer to them as tacit support for the DA. At heart they are Stepford wives and enablers of CBT because they have a serious bedrock conflict of interest. They won’t seriously criticize the Democrats who created and imposed FATCA, or the regime that saw the FBAR jihad unleashed on us in 2009, 2011, up until now. They won’t act for the repeal of FATCA or point out that Obama has not kept any of the promises he and the party made in the first campaign. of 2008 http://obama.3cdn.net/610c7f29ee85b124a3_3cm6bxltu.pdf http://isaacbrocksociety.ca/2012/04/10/senator-obamas-promises-to-americans-abroad/ . And I’m not being partisan. I was never a member of either party – and now I am no longer a UStaxablecitizen.
@Bubblebustin: I don’t see the problem with Todd Stoudt’s long submission that you linked in your post above (http://www.finance.senate.gov/legislation/download/?id=c971f108-daca-4d20-b450-a73b29b44284). Where is he right out of the DA Playbook? He describes a horrific scenario in which CBT and FATCA threaten his marriage and career, and at the end demands a repeal of FATCA.
In any case, the submissions are all pretty much in consensus with a couple small exceptions (and the Democrats Abroad, who I prefer not to think about). Even the woman in Sweden who is pro-CBT and has no intention of living abroad, and questions why anyone would dare to renounce their citizenship over this, actually undermines her whole pro-CBT rant, by pointing out over and over, “I’m not sure why, but people feel so strongly about this issue they’re renouncing US citizenship!”
I’m hoping to have some hope.
I am still trying to figure out why the Democrats won’t budge on CBT. I will start exploring the hypothesis that the support they receive from labor unions is hostile to American companies and employees of those companies working overseas.
My hypothesis could be completely wrong, but there has to be some logical reason why Democrats refuse to support RBT.
@Barbara
My apologies, sometimes my copy function on my iPad doesn’t work properly, so I ended up posting a previous link I posted. Thanks for pointing that out.
The link should be for Timothy F Sipples. He’s pro-CBT because we owe it to the US:
http://www.finance.senate.gov/legislation/download/?id=e8aaf751-1841-402b-9c5c-c8d8aa11ff9f
Would admin please replace the link in this comment with the above:
http://isaacbrocksociety.ca/2015/04/29/senate-finance-committee-posts-submissions-and-shadow-raider-reports-to-brock/comment-page-4/#comment-6040332
@ Bubblebustin,
Done. BTW, it’s really interesting reading those two one after the other.
TY, Pacifica.
Between these submissions and the ADCS thermometer (or whatever we’re calling it now ) I think I’ve had enough mood swings for any 24 hr period!
Have a great weekend, whether it be reading or playing, everyone.
I’ve been working my way, top to bottom, through the Individual list but I stopped last night to look at Todd Stoudt’s submission on the International list. It’s a very long story but it shows how confusing it can be to try to comply. He was calculating each salary payment from multiple employers with the daily exchange rate because nobody bothered to tell him he could MUCH more simply use the annual average exchange rate. It’s so easy to be baffle-gabbed by IRS publications and led astray by IRS publication interpreters. The minds of those U.S. tax code writers — “What a dump!”, as Betty Davis once exclaimed.
Badger good point / Obama promises he and the party made in the first campaign of 2008
Lets hope he reviews his commitments and we see change
Concerns of Americans Living Abroad: Obama believes it is important to understand the role of
Americans abroad in determining U.S. policy. Obama will work with members of the Americans abroad community and the U.S. embassies to determine how the U.S. government can be responsive to the concerns of overseas Americans.
He welcomes a continued dialogue between the White House, the State Department, and citizens
abroad in an Obama administration.
Obama understands the special concerns and issues of Americans living abroad and will seek to address these as president.
He will work with Americans abroad to identify and understand problems they may face as a result of U.S. government policies
Obama supports efforts to find an efficient and accurate procedure to count Americans living abroad in the U.S. Census
Perhaps remind him
https://www.whitehouse.gov/contact/
@Bubblebustin,
Even that one pro-CBT submitter thinks the current system should be made less onerous for overseas filers, I note.
Still no submissions from anyone arguing to tighten the screws further.
Interesting in USA gov search engine (this mean they are officially listening?)
http://search.usa.gov/search?affiliate=usagov&query=overseas+tax
Tax Reform in 2015: Impact on Overseas Americans
http://www.finance.senate.gov/legislation/download/?id=1bb98d6f-81fc-4551-afe6-0c8204209789
Tax Reform in 2015: Impact on Overseas Americans Individual and corporate tax reform is at the top of the agenda of the 114th Congress, on both …
JC has pointed out that the The Hill has noticed the publication of the SFC submissions.
http://thehill.com/policy/finance/240554-senate-tax-writers-get-1400-suggestions
Thanks, JC and EmBee for noting the Hill article. Of the approximately 319M people living in the US, only 1400 take issue enough with the tax code to actually make suggestions on to how to fix it?
It seems utterly preposterous that such a disproportionate number of people can affect change – but we are living in strange times!
@ Bubblebustin
Look at it this way … 350 out of 7.6 million outside sent submissions and 1050 out of 319 million inside sent submissions … so someone outside is 14 times more motivated to challenge the US tax system than someone inside … probably because those outside are treated 14 times worse than those inside … if I’ve done the math right. 🙂
Haha, EmBee, I don’t know if you got your math right but I had to laugh just on a conceptual basis!
From the The Hill article:
“But both Hatch and Wyden would prefer a more comprehensive overhaul of the tax code. Either way, the two parties remain divided on key tax reform issues.”
You think the US is ready for such change, change that’s nothing less than revolutionary due to the forces of inertia against it? Or is it like the Berlin Wall, a wall that actually crumbled before it’s physical manifestation did?
Sadly, EmBee, only 1400 submissions makes me think America’s not pissed-off enough. Or, is Rome burning and we just don’t realize it yet?
@ Bubblebustin
I wish I knew what the quantity of submissions really represents but I know that the quality (of the ones I’ve read so far) is encouraging. People put a lot of thought into what they wrote and I have to hope that counts for something with the committee.
The abusive and confiscatory FBAR Fundraiser is alive and well as wielded by the IRS (which you might remember was . Read the several FBAR focused submissions authored by a law firm De Vos & Co. PLLC.
For example;
http://www.finance.senate.gov/legislation/download/?id=441c9b64-801d-48c2-b53f-3ec1068a17a3
The others are also interesting.
For those who are not aware of the history of the FBAR, and that the IRS only relatively recently was given the FBAR to administer and enforce, and at their request also GIVEN a new NON-willful civil penalty (which didn’t exist before 2004; “…Congress, in Section 821 of the American Jobs Creation Act of 2004, reorganized Title 31 USC §5321(a) (5), and enacted a new civil penalty for non-willful violations of FBAR reporting requirements and increased the penalty for willful violators.19 ….” from http://www.taxlitigator.com/main/images/stories/Articles/Fbar_Enforcement.pdf
‘FBAR Enforcement—Five Years Later’ – Steven Toscher and Michel R. Stein),
You should read this:
http://www.hbtlj.org/v07p1/v07p1_sheppard.pdf
2006 HOUSTON BUSINESS AND TAX JOURNAL
EVOLUTION OF THE FBAR: WHERE WE WERE, WHERE WE ARE, AND WHY IT MATTERS
By Hale E. Sheppard
further important FBAR reading here:
http://www.chamberlainlaw.com/assets/attachments/sheppard_intertaxjrnl_2-4-13.pdf
http://130.94.232.94/articles/JTPP_08-02_Toscher.pdf
The FBAR is being used by the IRS to confiscate legal post-tax funds which in some of the cases mentioned in the De Vos & Co submission are not even US taxable (ex. inherited funds). This is blatant confiscatory revenue raising by robbery.