FROM IPOLITICS.CA (YOU CAN LEAVE YOUR COMMENTS ON THE WEBSITE):
[Thanks to Elizabeth Thompson — who shows what it means to be an “investigative journalist”.]
“Prime Minister Justin Trudeau’s government has reversed its position on the controversial transfer of Canadian banking information to the U.S. Internal Revenue Service and is now supporting a deal that Trudeau and other Liberals once sharply criticized.
In a written response to a request from iPolitics for an interview, Revenue Minister Diane Lebouthillier defended the deal and the CRA’s decision to transfer 155,000 Canadian banking records to the IRS in September during the federal election campaign.
“Minister Lebouthillier wants to reassure Canadians that all exchanges of information are subject to strict confidentiality rules,” reads the e-mail sent by Lebouthillier’s office.
“The CRA ensures that tax cooperation with its foreign partners is done in a manner fully consistent with privacy rights in Canada. It is important to note that Canada and the United States have a long history of exchanging tax information in a fair and responsible manner, going back to 1942.”
“Canada is required by law to exchange certain specific information with the U.S. under the Intergovernmental Agreement between Canada and the U.S. signed on February 5, 2014.”
“The CRA exchanged information with the Internal Revenue Service on September 30, 2015, as required.”
Thirty minutes later after the e-mail from the minister’s press secretary, CRA officials sent answers to a series of questions posed by iPolitics Tuesday, with answers that in a number of areas mirrored Lebouthillier’s response.
The position outlined by Lebouthillier Wednesday is in sharp contrast with the position expressed by Trudeau and several other Liberal MPs and candidates prior to the election.
In a letter dated June 25, 2015 to Lynne Swanson of the Alliance for the Defence of Canadian Sovereignty, which has been fighting to stop the CRA from turning the records over to the IRS, Trudeau described the “implications of having the CRA report to a foreign government agency about Canadian citizens” as “troublesome.”
“While the United States has the right to target tax evaders using offshore accounts, targeting hard working Canadians who pay taxes is unfair,” Trudeau added. “The Government of Canada has a responsibility to stand up for its citizens when foreign governments are encroaching on their rights. We believe that the deal reached between Canada and the U.S. is insufficient to protect affected Canadians.”
During the election campaign, Liberal Darrell Samson, who was elected MP for the Nova Scotia riding of Sackville-Preston-Chezzetcook, pointed out that Liberals had criticized the information sharing in the House of Commons and questioned whether the move was even constitutional.
“We also have concerns that the agreement reached with the U.S. may not stand up to a Constitutional challenge given that it forces the banks to treat clients differently based on their national origin, something forbidden by Section 15 of the Charter of Rights and Freedoms,” he wrote on his website.
Lebouthillier’s position is also in sharp contrast with the positions taken by three of her current cabinet colleagues prior to the election – Treasury Board President Scott Brison, Public Safety Minister Ralph Goodale and Transport Minister Marc Garneau.
Lebouthillier’s position also contradicts the position taken before the election by her own parliamentary secretary, Emmanuel Dubourg, a former CRA official, who warned in a June 2014 oped in the National Post that FATCA and the information sharing deal was dangerous.
“The largest assault by the Conservatives against personal information came in the form of Bill C-31, the omnibus budget implementation bill,” Dubourg wrote. “This bill would amend the Income Tax Act, allowing an officer of the CRA to provide confidential information to domestic or foreign police organizations. This breach of Canadian tax secrecy is dangerous. Under this act, an official could unilaterally disclose confidential information, regardless of whether criminal proceedings had been initiated.”
Dubourg said Canada should require a judge’s order before turning information over to the IRS.
“We must deny the Conservatives permission to allow the transmission of personal information without the authorization of a judge, under the pretense of combating tax evasion. Instead, the government should focus its energies in countering the scourge of tax havens, where they could recover billions of dollars.”
Asked about the contrast between Lebouthillier’s position and Trudeau’s position before the election, Lebouthillier’s press secretary Chloe Luciani-Girouard said Lebouthillier cannot speak on behalf of the prime minister office and referred questions to Trudeau’s PMO which has not yet responded to questions from iPolitics.
Meanwhile, opponents of the deal, like Swanson, were furious.
“This is a despicable cop out,” she said. “The Conservatives surrendered Canadian citizens, laws, constitution, Charter of Rights and Freedoms and sovereignty to a foreign bully. The Liberals are now proudly waving the white flag.”
“How can the Minister and Prime Minister justify this after Justin Trudeau’s letter to me and all the Liberal comments made against FATCA?”
The controversy centres on a deal worked out between Canada and the U.S. in the wake of the U.S.’s decision to adopt the Foreign Account Tax Compliance Act (FATCA), which pressured financial institutions around the world to reveal information about bank accounts in a bid to crack down on tax evasion by U.S. taxpayers with foreign accounts.
The Conservatives have argued that given the penalties the U.S. was threatening to impose, they had no choice but to negotiate the information sharing deal and through the deal was able to exempt some types of accounts such as RRSPs and Tax Free Savings Accounts from the information transfer.
Documents tabled in the House of Commons last week spelled out how the Canada Revenue Agency transferred 155,000 Canadian banking records to the IRS last September without waiting for an assessment by Canada’s commissioner or the outcome of a legal challenge to the constitutionality of the move.
A second transfer of records to the IRS is scheduled for September 30, 2016.
In its response to iPolitics, CRA officials downplayed the decision to proceed with the transfer of 155,000 records to the IRS before it received an assessment from the Privacy Commissioner’s Daniel Therrien’s office (OPC), saying it consulted Therrien’s office and “received valuable input.”
“The recommendations do not prevent the CRA from exchanging the required information. Action plans in response to the OPC’s recommendations are being prepared.”
Officials indicated the CRA does not have any plans to notify Canadians whose banking records were transferred to the IRS.
“The legislation implementing the IGA requires that Canadian financial institutions communicate with account holders of pre-existing accounts if there is information suggesting that they are a U.S. citizen or resident (eg. their client file contains a U.S. contact address or phone number). These clients would therefore be on notice that their information may be exchanged with the U.S. Internal Revenue Service.”
Nor is Canada the only country that has transferred banking records to the IRS as a result of FATCA and information sharing deals, they pointed out.
“The U.S. government has signed, or is in the process of negotiating, similar IGA’s (intergovernmental agreements) with over 100 other countries. These IGAs contain similar obligations to those in the IGA between Canada and the U.S. The IGA is subject to the strict confidentiality rules set out in the treaty.”
However, Allison Christians, a McGill University expert in tax law, isn’t so sure the banking information the CRA transferred to the IRS will remain confidential.
Christians said the IRS “routinely” shares information with other U.S. government agencies such as the FBI or the CIA should it see anything it believes could indicate a breach of U.S. law. However, there are things like doing business with Cuba or some sections of the Foreign Corrupt Practices Act which are offences in the U.S but not in Canada.
Christians said the IRS also has an antiquated information technology system and a poor track record when it comes to data security.
“There have been story after story after story of hackers, phishers stealing data from the IRS, using it to defraud taxpayers in the United States. It’s a huge market, it’s a huge target and now Canada has willingly contributed the data of 155,000 accounts to that problem without any study whatsoever, without any public discussion.”
Christians says the information sharing deal also gives the CRA access to banking information on Canadians that it would not normally be able to access without a court order.
“The CRA, for example, could not require blanket information requests from Canadian banks on Canadians under the Income Tax Act, it could not do that without the involvement of a judge. But that is exactly what FATCA requires and so the CRA is now, very quietly, collecting a lot of information that under the Income Tax Act would not have been possible on Canadians.”
Christians said adopting the OECD’s criteria of residency rather than citizenship and refusing to send the IRS information on anyone living in Canada would drastically reduce the information on Canadian residents being sent to the IRS.”
elizabeththompson@ipolitics.ca
CANADIAN READERS: ANGER WILL NOT BE ENOUGH TO CHANGE MINDS. PLEASE TURN YOUR ANGER INTO AFFIDAVITS FOR OUR LAWSUIT: CONTACT ME AT stephen.kish.chair@adcs-adsc.ca IF INTERESTED.
Minister of National Revenue, who we are suing, has come out of hiding with a statement.
So, what dd you really expect from the Liberal Government.
We need more Witnesses.
I recently sent this email and will send Mr. Dusseault another one to bring this article to his attention.
To: Pierre-Luc.Dusseault@parl.gc.ca Cc: pierre-luc.dusseault.a1@parl.gc.ca, thomas.mulcair@parl.gc.ca, Elizabeth.May@parl.gc.ca
Mr. Pierre-Luc Dusseault
Member of Parliament for Sherbrooke
NDP Revenue Critic
Dear MP Dusseault:
Thank you for your work regarding the recent questioning of the Government on the FATCA-IGA transfer of Canadian financial accounts from the CRA to the IRS. As Canadian citizens who live in Canada, we greatly appreciate your diligence regarding this issue.
We would like to suggest these “follow-up” questions for you to ask the Government:
1. For Prime Minister Justin Trudeau:
You previously stated in June, 2015 that “the Government of Canada has a responsibility to stand up for its citizens when foreign governments are encroaching on their rights. We believe that the deal reached between Canada and the US is insufficient to protect affected Canadians.”
Does the Prime Minister still hold this opinion? If not, why? If yes, why has he taken no action to sufficiently protect affected Canadians? Will he use his apparent good relations with President Obama to negotiate an agreement whereby affected Canadians will be sufficiently protected?
2. For Minister Scott Brison:
When you were a member (Vice-Chair) of the Standing Committe on Finance, you voted in 2014 for an amendment to the C-31 FATCA IGA enabling legislation that would have excluded Canadian citizens resident in Canada from the FATCA IGA definition of a “US Person”. Why is the Liberal majority Government now not willing to take this action, which would uphold the Charter and privacy rights of affected Canadians?
3. For Minister Ralph Goodale:
In October, 2011 you clearly stated that “the USA should not try to enforce its tax laws against law-abiding Canadians”, and that the Canadian government “must stand shoulder to shoulder with innocent citizens and taxpayers – to inform and assist them in fending off abusive American tax enforcement proceedings”. Why have you not taken any actions to back up this strongly worded position?
4. For Minister of Justice and Attorney General Jody Wilson-Raybould:
How can the “public interest and tax regime integrity of the United States” override the Charter (sections 7, 8, 15) and financial privacy rights of Canadian citizens resident in Canada?
If, in the pursuit of unjust tax and penalties, the United States can use its economic power to extort Canada to violate these Charter and privacy rights of resident Canadian citizens, will the Minister acknowledge that Canada’s Charter of Rights and Freedoms has no real significance and does not truly apply to all Canadians?
We very much hope that you will have the opportunity to include these questions in your further interactions with the Liberal majority Government. Thank you very much.
Yours Sincerely, XXXXX
We need Allison Christians on our witness list
I am extremely grateful to Elizabeth Thompson for her superb reporting of our issue. Two articles on consecutive days that have finally garnered a response from Liberals who have been the recipients of many, many unacknowledged letters since the election.
I am unable to comment at iPolitics directly so I hope that other Brockers may be able to pass along to Ms. Thompson our gratitude for what she has accomplished.
MuzzledNoMore,
I commented there as calgary411. I feel that with this break-through, our voices must not be further silenced in getting this in front of ALL Canadians (especially those who will be affected though they still are not aware) by a responsible journalist who hasn’t been gagged. Responsible comments from those who think they can say that all of this is wrong will show our support to Elizabeth Thompson.
Again, thanks so much to Lynne Swanson for what must have been a passionate interview with Elizabeth. And, thanks to John Richardson for yet another short but to the point media interview with CBC. What a shame that some of our comments were pulled by CBC News and just what that says. Inch by bloody inch.
Sent to my newly elected Liberal MP in Toronto-Danforth.
I see that despite all the Liberal verbiage about defending the rights of Canadian citizens during the election, once elected, this all goes down the toilet.
What are YOU prepared to do to deal with this blatant Charter violation of Canadian citizens’ rights?
I want a written reply.
I have written to the Prime Minister. Utter, utter disappointment. My last hope, really, as far as government leaders go.
@Joe Smith I hope you have better luck with your Fibbing Lib Hypocrite than I have had with mine.
She will not respond in writing. She will not meet with me.
I have known her for 17 years. I worked with her for about 8 years.
Lynne, that lack of communication shows your MP’s character and integrity and now lock-step with the Liberals that rule.
Good luck, Joe Smith, in getting a written reply from your Canadian government representative. So many of us no longer have a Canadian government representative who will listen and who will represent us. And, somehow, they continue to get our votes.
I have always felt that the Liberals would be much worse on this issue than the Conservatives were. I never felt that the Conservatives liked or supported FATCA (but were bullied into the IGA by the Canadian banks). My impression is that the new Liberal Government likes and supports FATCA.
But, there is a reason for this. The Conservatives had to deal with the issue from the beginning. The Liberals “inherited” the FATCA issue (which from their point of view is not an issue at all). They don’t even understand FATCA.
It’s great to see Professor Christians bring up the fact that the CRA is now receiving unprecented levels of information on Canadians as a result to signing on to the IGA. This is precisely my beef. Yes, she would make an excellent witness, IMO.
The articles seem to be coming fast and furious at the moment. Rather than barrage my MP on a daily basis, I think I’ll start doing an end of week summary – and let her and her staff chew on that.
Thank you Lynne for your diligence, intelligence and passion in getting this out there.
Thanks very much to the brave Canadian who sent me an email this morning volunteering to help out as a Witness.
— Yes, you can keep sending emails and letters to Liberal Government politicians to try to change their political minds, but can more Canadians reading this post also please consider volunteering as a witness in an actual lawsuit?
The lawsuit, unlike letters to politicians, is aimed at compelling (not requesting) Liberal Government to change its mind.
If you cannot volunteer, can you please ask around and ask others to consider volunteering as a witness?
I figured out for myself, through my own cost / benefit analysis, what my energies need to be directed to. I have wasted many, way too many, (thanks, JustMe!) Life Credit Units (LCU’s) trying to communicate with those I thought were my government representatives whose duty I thought it was to represent me. At 72, I don’t have a lot of LCU’s left in my account. I am one of those of us here who really wants to stand up for what I / we believe is right and to help those with little voice might have to do the same. I have come to my own conclusion that the only way forward is our litigation rather than one-way conversations with anyone in government, either side of the US/Canadian border.
@ Mr. A
Excellent questions in your letter. Thanks.
We need witnesses.
This is not my Government or my country, but I am spitting nails nonetheless.
A Canadian is a Canadian, BULLSHIT.
@Blaze
It matter not whether your MP returns your enquiries. Mine does and it hasn’t resulted in anything – just deafening silence, and apparent inaction.
My letter to her office today:
Dear Pam,
This feels great that I keep sending you letters and get responses from your office – it’s certainly a lot more than what others get from their MP’s, but what’s really happening?
I have gone from hoping that the Liberal government would uphold its pledge that “a Canadian is a Canadian is a Canadian” to the sad realization that those words were merely political and don’t apply to all Canadians.
I have now learned that the CRA advised our Revenue Minister last November to stay the course on executing the FATCA IGA, on the basis that legal efforts on both sides of the border have done nothing to deter it. Since when do court proceedings in a foreign country have any standing in Canada? As for the court proceedings in Canada, they dealt only with the tax-treat aspects of the IGA – not those of the Canadian Charter. Do you intend to also deny me my rights and protections on that front too – or is our Prime Minister going to say the US made Canada do that too? At a certain point, Mr Trudeau and our government need to take a stand and get itself on the right side of history before it’s too late. I know that there’s much to be said about not playing one’s hand too quickly – especially in matters of international diplomacy, but when the press and general public are now coming out in support of telling the US where to put FATCA, it’s about time our government comes out in support of its people – period.
This week’s Canadian press about this mess:
Liberals told no action needed on controversial U.S. tax deal
“Liberal MPs, including Justin Trudeau, criticized the deal at the time, saying it did not adequately protect the privacy of Canadians who are also U.S. citizens. But the “personal information” plank of the Liberal election platform did not refer to FATCA, only to making it easier for Canadians to access their own personal information from government.”
http://www.cbc.ca/news/politics/liberals-told-no-action-needed-on-controversial-u-s-tax-deal-1.3494007
Trudeau Liberals reverse position on controversial IRS information sharing deal
“While the United States has the right to target tax evaders using offshore accounts, targeting hard working Canadians who pay taxes is unfair,” Trudeau added. “The Government of Canada has a responsibility to stand up for its citizens when foreign governments are encroaching on their rights. We believe that the deal reached between Canada and the U.S. is insufficient to protect affected Canadians.”
http://ipolitics.ca/2016/03/17/trudeau-liberals-reverse-position-on-controversial-irs-information-sharing-deal/#comment-2574788281
Revenue Canada quietly handed 155,000 Canadian banking records to IRS
“The CRA says it submitted a privacy impact assessment to Privacy Commissioner Daniel Therrien’s office for review on Aug. 27, 2015 but only received recommendations from Therrien on Jan. 4, 2016 – well after the records had already been transferred.”
…”What is worrying me is that CRA is not notifying people automatically whose information was transferred,” Dusseault explained. “So the CRA has some information on Canadian citizens who are happen to also have American citizenship and these people had their information transferred on September 30 without a lot of noise.””
http://ipolitics.ca/2016/03/16/revenue-canada-quietly-handed-155000-canadian-banking-records-to-irs/
The Canada Revenue Agency is rotten to the core. Time to clean house.
“This week, we learned that the CRA turned over 155,000 banking records to the U.S. Internal Revenue Service in the middle of last year’s federal election — without waiting for the outcome of a court challenge to this unprecedented sharing of taxpayer data, without hearing an opinion from the Privacy Commissioner. And the individuals involved have never been informed by the CRA of its action.”
http://ipolitics.ca/2016/03/16/the-canada-revenue-agency-is-rotten-to-the-core-time-to-clean-house/
Is our government going to step up for Canadians, or is it “see you in court”?
***
That’s “tax-treaty” aspects, of course. She got the corrected copy.
I wrote Mr Goodale asking him where along the way he lost his self-respect. The astounding duplicity of him and his colleagues is simply outrageous. Same letter went to Brison. Of course, no response will be forthcoming, and it’s doubtful they will even see the letter as it will be screened out by some minion along the way. Still, the stark contrast of the Trudeau government behaviour behind the scenes versus the glitzy Obama Love-in is all the proof needed that voters were indeed suckered. All paper and no tobacco…that’s our liar of a PM.
Another Liberal MP who stated that “a Canadian is a Canadian is a Canadian” in criticism of a prior CON bill;
Citizenship Act
Government Orders
June 16th, 2016 / 4:35 p.m.
“……..During the last election campaign, our Prime Minister and the Liberal Party of Canada made clear to the millions of Canadians whose citizenship had been denigrated to second-class status and done so retroactively by the previous government’s Bill C-24 that we would rescind the offending clauses of that legislation. Simply put, under a Liberal government a Canadian would be a Canadian would be a Canadian once again.
A foundational principle of western liberal democracies is the concept of égalité: that every citizen is equal before the law and is to be treated equally by the law. No citizen has an inherent birthright privilege. This runs counter to historical feudal notions of hierarchical rights granted to different groups based upon birth: caste born into; ethnicity born into; wealth born into; or, in the extreme, the birthright of royalty and the absolute, the divine right of kings. In the liberal democratic west, we are beneficiaries of a system built upon the sacrifices of those who revolted against the injustice of feudal birthright inequality.
The concept of equality was at the core of the French and American revolutions and succinctly put into the American Declaration of Independence by Thomas Jefferson, who wrote, “all men are created equal”. I would with humility paraphrase today that all humans are created equal.
In Canada, the principle is enshrined in our Charter of Rights and Freedoms. We live under a system of rule of law. However, all laws must subscribe to the fundamental principles of the Charter of Rights.”…..
……..”Why did the Conservative government, in the year leading up to an election year, enact a law so deeply flawed; a law that not only offends the fundamental principle of equality before the law; a law that would not stand up to a charter challenge;…”……..
……It is with pride that, this upcoming Canada Day, we will be able to declare that our Prime Minister and our government have fulfilled their commitment and under the current government, once again, in Canada, a Canadian is a Canadian is a Canadian.”
https://openparliament.ca/debates/2016/6/16/borys-wrzesnewskyj-1/
And, another Liberal MP says;
“…A Canadian is a Canadian is a Canadian. I know that line has been used on both sides of the House, but it is true. It is true that if we go down the road of having more than one class of citizenship, it will render less valuable the fact that someone is a Canadian citizen.
Being a dual citizen means that an individual is a Canadian citizen. However, a Canadian citizen is the same, whether or not they have more than one passport.”…
Liberal MP Colin Fraser West Nova, NS
https://openparliament.ca/debates/2016/3/10/colin-fraser-2/
For more,
Do a search of openparliament.ca for the phrase “a Canadian is a Canadian is a Canadian”
Useful if pursuing specific MPs re the FATCA IGA.