A chaotic situation, often one that involves several people [or organizations], each with a different agenda/vision/perception of what’s going on; a situation that is very difficult, despite energy and efforts, to instill any sense or order into.
I don’t think there’s a much more apt expression for what is happening right now in the larger FATCA / FBAR / CBT universe. The calm-before-the-storm waiting game of the last few years is now clearly giving way to frenzied activity and veritable verbal warfare across multiple organizations and web sites around the globe. The big-picture dots of this reality have not yet been fully connected into a single post and thread, so that’s why I’m starting this one.
In no particular order, here are some of the latest developments to consider:
1. The ADCS summary trial is poised to begin next Tuesday, August 4th. Even now, the Canadian Government is wheeling out their propaganda machine to fight our lawsuit in the court of public opinion as well as in the Federal Court in Vancouver. One of the first targets of their inevitable smear campaign is our legal counsel, Joe Arvay, via a Conservative Party soapbox piece published in today’s Globe and Mail. And, as I write this, news that the Canadian federal government, “…may seek an adjournment of the summary trial scheduled to be heard on August 4-5,” as reported in the ADCS thread.
2. Mirroring the Canadian Charter Challenge is last week’s filing of the James Bopp / Republicans Overseas Action FATCA lawsuit whose seven plaintiffs include Rand Paul and Stephen Kish.
3. Republicans Overseas reports on the US Federal government response to their motion to expedite a Preliminary Injunction:
On July 22, Republicans Overseas Action and the seven Plaintiffs asked the District Court to expedite the consideration of the request for a preliminary injunction to give the Court adequate time decide the matter before some of Plaintiffs’ sensitive account information is reported to the IRS at the end of September. The government’s response is to say that shortening its response time would be too burdensome and that it needs even more time to respond. Normally, they would have 21 days to respond, and we’ve only asked to have that time shortened by a week. The federal government instead has asked the Court to delay the suit and give them 60 days to respond to Plaintiffs’ request for a preliminary injunction—three times the amount of time to which it would normally be entitled! The truth is that the Plaintiffs are the ones playing catch up in this case. The government has had nearly five years to consider the constitutional underpinnings of FATCA. They should not be allowed to complain now that they need more time to understand it when American citizens’ constitutional rights are being pushed aside.
4. Democrats Abroad has published a couple of trash-talk pieces here and here condemning the Bopp/RO suit. So far, every one of the 22 comments on the DA Switzerland piece has been uniformly opposed to DA’s positions on FATCA and Same Country Safe Harbor (SCSH), which has also been referred to as SCE (Same Country Exception).
5. Democrats Abroad has doubled-down on its SCSH campaign by re-igniting its FATCA Reform 1000 letters sign-on campaign, apparently completely ignoring the frustration of its dwindling constituency, as exemplified by one of the comments:
Most of us will not support this. Same country exemption is a diversion from the issue. It will enable you to try and tell people that you have done something. 90% of us see right through this and want nothing to do with this. Full repeal of FATCA and CBT is what needs to be done. Anything else is a distraction. Time for the democrats to join the rest of the world and use the world standard tax practice of residence based taxation (RBT). Why does the party of “progress” want to hold onto an outdated, civil war era tax policy that all other countries have abandoned?
6. Republicans Overseas is also pushing back on SCSH and the letter writing campaign:
By delaying the Motion for Preliminary Injunction, it gives DA time to push for the Same Country Safe Harbor (SCSH) exemption
DA is asking expats to write 1,000 letter to Congress to support SCSH by pressuring Treasury Secretary Lacob Lew and IRS Commissioner John Koskinen to selectively enforce FATCA based on expats’ accounts in one foreign country or more than one foreign country. DA knows better than that. This is lawlessness because neither Secretary Lew nor Commissioner Koskinen have the constitutional authority to amend or selectively enforce FATCA without a vote in Congress to amend the law.
7. Meanwhile, other organizations have apparently chosen to hitch their wagons to the increasingly-maligned Safe Harbor campaign, including FAWCO (Federation of American Women’s Clubs Overseas) and AARO (Association of Americans Resident Overseas), though the latter has posted a position paper calling for the replacement of CBT with RBT. American Citizens Abroad has remained rather low-key, focussing on its own, rather convoluted RBT proposal and partnering with the University of Nevada via its ACA Global Foundation on a research study about the effects of FATCA on American citizens living abroad. Other groups, such as American Expatriates, appear to be inundated by a confusing and often contradictory array of opinions from across the political spectrum, though the same thing can often be said of IBS.
8. The Trump factor. Will his brand of demagoguery help or hurt our cause? Here is a quote from his most recent advertorial for his own book:
America has become the world’s “dumping ground” for everyone else’s problems. A “whipping boy” for other countries as we sink further and further into the debt of no return.
Trump warns of so-called leaders willingly giving our jobs to foreign hands and further crippling the economy. Literally taking future opportunities from our children and grandchildren.
Meanwhile those same leaders feed America’s looming debt beast — an $18 trillion tab — with foreign aid and terrible negotiations.
And what then do we get for extending our wealth to help a legion of other countries? Lack of respect. We’re the “laughingstock” of the world.
These are just a few examples of how fragmented and confusing the landscape has become, and just how far away US Persons are from achieving any kind of consensus about how best to fight back against FATCA and CBT. The dominant “camps” now emerging are, predictably, identifiable largely along traditional party lines, but with some important exceptions. On one hand, “Safe Harbor” has crystallized into the Democrats singular take-it-or-leave-it proposition. On the other hand are the lawsuits in both the US and Canada, initiated by an increasingly diverse mix of Republicans, disaffected Democrats and untold numbers of other supporters who have no allegiance to any US party. In the case of Canada, our battle is dishearteningly with our own Canadian government, which has lowered itself to becoming a mere proxy for the US. Nevertheless, when it comes to the issues of FATCA, FBAR and CBT, it would appear that the most dominant fault line now starkly divides an increasingly out-of-touch and disingenuous Democratic Party with, literally, everyone else on the planet.
Victoria, this has been one of my questions all along, and which I ask my ‘progressive’ friends who, like yours, cry, “Tax the cheaters!”
If you live in Dayton, Ohio, and want to hide money, who the heck needs an offshore account? Go to the bank or credit union across the street from where you do your normal banking, and open an account! Sure, they’ll want your social security number and report your interest income to the IRS. At today’s interest rates, if you kept $100,000 in the bank next door, you might get $100 interest annually. So just put that $100 on your 1040 under “dividends and interest”; it raises no red flags. If it starts to approach $2000 in interest, for which you’d have to declare the source on (I think) Schedule B, then just divide it into two accounts. No FBARs, no 8938, no FATCA. The IRS has no knowledge of where you bank, and any evidence of illicit business would only come from other sources. And by declaring the interest, you’ve tossed the IRS a bone. Why would anyone other than somebody with billions to hide even consider putting deposits offshore? And those with billions to hide are clever and lawyered up enough to know what they’re doing. And there’s always Delaware. The point being, that FATCA (and FBARs) are, at their core, pointless.
When I present this argument to ‘progressive’ homelanders, if they’re still listening, about a quarter of them show a dawn of understanding. The rest shrug and say, “Tax the cheaters!” I can’t even get started on CBT.
Regarding your preference for more subdued media coverage on the lawsuits, I’m with you for now. I wonder why we haven’t seen this headline:
” American Expats in Canada Bankroll their Lawsuit, SueCanada”
“American Expats in Canada to IRS: Hell no, we won’t Come Clean!”
“American Expats Around the World Head to Court. Say To IRS, ‘Pay Your own Damn Fair Share!‘ “
“The very well to do have lawyers for such things – tax avoidance, they call it.”
Tax avoidance isn’t tax evasion, so something was lost in translation.
“Are there any studies that show whether a state would gain more revenue by going after offshore accounts versus, say, auditing 50% of small business owners?”
Probably but I don’t think it matters. The US gains more revenue from penalizing people whose US tax is zero than from auditing anyone.
I tried to compel the IRS to audit me. Courts refused. They would lose revenue if the IRS audited me.
‘I wonder why we haven’t seen this headline: ”American Expats in Canada Bankroll their Lawsuit, Sue
Because you didn’t find appropriate words that would make Google find such articles? Though the closest headline I know is “I Am Canada. Hear Me Roar”, http://maplesandbox.ca/2014/i-am-canada-hear-me-roar/