Posted by Barbara on the Media thread. Cross-posted from there.
UPDATE: Emailed letters will be delivered to the White House on OCTOBER 2. Deadline for sending emails is SEPTEMBER 30!!!
Write your letters, people!!
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YOU MUST ACT NOW!! NO EXCUSES!! PLEASE SHARE WITH ALL FELLOW AMERICANS OVERSEAS (regardless of party affiliation or non-affiliation) & ACCIDENTAL AMERICANS!! If you do nothing, nothing will change!!
We need your help. The Senate Finance Committee and the House Ways and Means Committee are working on tax reform, and we need to get overseas Americans’ voices heard. We have not had tax reform for 31 years, and if we miss our window now, we will not see another chance for 20 more years.
At the initiative of Republicans Overseas, the RNC recently adopted a White House approved resolution supporting the change from citizenship based taxation (CBT) to residence based taxation via RO’s proposed Territorial Taxation for Individuals (TTFI). We have champions and sponsors in both the House and the Senate. We have found tax loopholes that TTFI would close, thereby making TTFI revenue positive. The ingredients for success are lined up–but we’re missing one: the massed voices of ordinary overseas Americans.
What we need now is for our representatives to hear from as many overseas Americans as we can gather. We believe that the vast majority of overseas Americans support the inclusion of TTFI to the tax reform package, and we need to hear from thousands of them. We want to collect as many letters supporting TTFI and tax reform as we possibly can, which Solomon Yue will then present to the White House.
Can you please support our initiative by writing a letter to President Trump and copying your Congressman and Senator.
Here’s how it will work:
1) RO is providing a letter template along with an example which can be found here:
https://republicansoverseas.com/territorial-taxation-individuals/#sample-letters
We urge letter writers to share their own short stories, but also to link their letters to the themes outlined by the White House in their press release on tax reform by focusing on two points: \
(a) TTFI reduces the cost of hiring Americans working overseas, increases U.S. exports, and creates more American jobs within the U.S., and (b) it reduces tax preparation costs for overseas Americans. The sample letter already does this, but it is important to reiterate that we need to reinforce the White House’s points and link those points to individual situations.
2) The letters should be emailed to taxreform@republicansoverseas.com and copied to their local representative and Senators. Links to government databases providing this information can be found at
https://republicansoverseas.com/territorial-taxation-individuals/#contact-congress
3) Solomon Yue will print out the letters and take the physical package to the White House. Clearly, the more the better!
Thank you for your support! If you have any questions or suggestions, please contact Kym Kettler-Paddock at kym.kettler-paddock@republicansoverseas.com.
Regards,
Michael DeSombre
Worldwide President, Republicans Overseas
Brilliant. I will email copies of all 7 of the paper letters already sent (Hatch, Cohn, Brady, Knight, Ryan, McConnell, I’m forgetting one) to Salomon Yue.
Would Territorial Taxation for Individuals (TTFI) really be like Residency-Based Taxation?
(I realize nothing is finalized right now).
To be truly useful this reform, TTFI, would:
1/ Eliminate FBARs for those not residing in the US,
2/ Eliminate tax return filing obligations if one has no financial business in the US,
3/ Make it easy to leave the US to reside elsewhere, i.e. minimal or no exit requirements. Territorial taxation eliminates the “need” for a punitive exit tax, if I understand correctly. Someone with no assets could just leave. Someone with assets in the US and abroad would leave easily and continue to submit returns concerning US incomes.
I hope they don’t bungle this, I really do.
Presumably the Territorial Tax proposal that Republicans Overseas and the RNC are talking about is this one:
http://republicansoverseas.com/wp-content/uploads/Territorial-Tax-Reform-Proposal-Jan-6-2017.pdf
In which case, note how many times this proposal requires the US to remove or renege on tax treaty commitments it has previously made and agreed to with other countries. The outcome in all cases would be a massive increase in US tax on NRAs, accompanied in some countries by a requirement for that country to provide a local tax credit for the NRA’s increased US tax. Then consider what effect this might have on a) incoming investment into the US from outside, whether from a treaty country or not, and b) the potential for retaliatory measures by the countries who find themselves on the other end of a US tax treaty that the US now intends to largely eviscerate.
How likely is it that the US would risk all of that inward investment into its economy by NRAs in order to shift to Territorial Taxation?
My own personal view is that these ‘removal of Treaty Benefits‘ parts of the proposal sink it entirely. Perhaps it was smoke-a-bowl-of-crack-Tuesday when this proposal was drafted, but that’s no excuse for leaving all the flaws in at this point. It’s just nuts. Unless you hope to fail, that is.
Don’t get me wrong. CBT is evil, and needs to go. It is just that this isn’t the way to do it.
@ Watcher
“The outcome in all cases would be a massive increase in US tax on NRAs …”
So anyone with US income, no matter where they reside, no matter what their nationality, would be taxed on that income by the USA. Right? That really doesn’t seem too unfair to me and frankly I could care less if people end up looking to other places than the USA to invest. If the income from US investments is so much better then they’ll just have to accept the USA has first dibs at taxing it. After all, it wasn’t their country of residence which produced the conditions conducive to generating that income, it was the USA. It’s just giving tax unto Caesar for income which was made possible by Caesar. BTW, removing and reneging on agreements is SOP for the USA. The rest of the world has come to accept it because America has the power … for now.
Does anyone know if Solomon Yue has a deadline for these letters?
@ MuzzledNoMore
Did a quick look at RO Facebook and it looks like they will personally deliver these letters to the White House on October 2nd so the deadline is September 30th. It’s a do it sooner rather than later thing, I’d say. Also it looks like DA are ameniable to joining the letter writing campaign. They say 4000 have filled out their petition so far. It would be wonderful if most of those would write a letter too. Forget what may divide and come together for a common cause.
DA @ RO: “Thanks for bringing to our attention! We’d encourage all Americans abroad to share their stories through the letter writing campaign.”
No US government representatives for me as I OFFICIALLY renounced my US citizenship in 2012 (though told I was doing so by becoming a Canadian citizen in 1975). I would like my views expressed by someone.
Just release my son and others like him who cannot renounce a supposed US-deemed USC that was never in any way claimed or accepted. He was born in Canada, never registered as a *US Birth Abroad*, never lived a day of his life in the US, and never has had any benefit for the US. In trying to determine how this *acquired* USC could exist no more, I learned that the parent(s), guardian or trustee of *a person without requisite capacity* (for whatever reason) cannot act to renounce that *supposed US-deemed USC* on such a person’s behalf — it must be understood and acted upon as a decision from only the person involved, no influence from any other.
I will continue to reject, on my son’s behalf, his US-determined acquired *US-deemed USC*. Unless a way out of this absurdity is changed for persons without requisite mental capacity, it is sanctioned US entrapment into yearly (and beyond) expensive because so complex tax and bank account reporting compliance (lack of privacy) to what is REALLY a foreign country, the US, with the assistance of the US tax compliance industry.
@Embee
I’m also not that bothered personally if US inward investment falls of a cliff as a result of a transition to Territorial Tax. But what you or I think is immaterial. What matters is what Congress thinks.
And in this case they will be weighing up an improvement in rights for some nine million US citizens abroad against the economic effects of making US investments look much less attractive for around five billion or so non-US citizens. If the US’s fanatical yet pathological insistence on CBT over the long term has told us anything at all, it is that US economic self-interest beats individual rights every time.
Congress would have to be mad to take the risk here, so they won’t. The idea of territorial tax for individuals will then wither and die, and along with it goes a lot of the reform momentum built up recently, including any chance at a much more conventional and user-friendly RBT regime that would solve all the problems for US citizens just the same but without all of the collateral damage.
This whole proposal could have been far better constructed. But it wasn’t. It was flawed from the outset, and despite multiple chances to improve it, all the flaws were left in. Basically then, a huge wasted opportunity.
@ Watcher
I think the idea is to send individual territorial tax in on the coat tails of corporate territorial tax. It might just be a better strategy than you think. It has the appearance of harmonizing the tax system. I really don’t know how Congress will size up this proposal but I know they pretty much always cater to their own best interests.
Brock Society prominent in this article:
US political parties, other overseas groups ramp up resi-based tax campaign
By: Helen Burggraf | 13 Sep 2017
http://www.internationalinvestment.net/products/us-political-parties-overseas-groups-ramp-resi-based-tax-campaign/
@Fred according to tax treaties source country has first right of taxation. That tax, by treaty, then may be claimed as a tax credit (“prevention” of double tax provisions) with the country of residence. The U.S. already has a witholding regime for dividends/interest for foreign holders.
Advanced is “territorial” for individuals yet with RO language such as “only taxed once on worldwide income” then this suggests the application/legislation will more closely resemble residence based taxation.
This sounds like the best opportunity to get a letter into the White House. I don’t mind / would like posting of them all somewhere on the web. I have a draft in the works. I’ll post on Brock. As “a picture is worth a thousand words” my letter will include at least one meme I use on Twitter.
@FredB
TBT would mean that every tax treaty the US has with foreign countries would have to be torn up and renegotiated.
From an individual perspective my US pension which is my major source of income and is now taxed whoely in my residence country would then be taxed in the US. I cannot see my country of residence giving up this provision.
Double taxation looms on the horizon if this is passed.
Can anyone come up with a POSTCARD (with overseas stamp) stating 10 points why RBT should prevail ?
From Democrats Abroad Ireland
As far as a postcard for RBT and why it should prevail – I’m sure I can come up with something. What are you thinking?
From Republicans Overseas
So far four ideas
Territorial Taxation for Individuals is tax-revenue positive because it eliminates current loopholes that allow wealthy foreigners not resident in the United States to generate substantial income in the United States without paying their fair share of tax.
Territorial Taxation would allow for an increase of American exports.
Territorial Taxation will attract skilled immigration to the U.S. and support the RAISE ACT.
Territorial Taxation would end the discriminatory costs of tax compliance on overseas Americans.
From Keith Redmond https://www.facebook.com/American.Overseas.Global.Advocate/
Sure someone could. Happy to proof the card should someone put it together
EmBee: Thank you for finding those dates! I will update the post.
Calgary: I sent my letter off just a couple minutes before I read your comment otherwise I would have included a specific mention of your son’s situation. Would you consider writing about your son’s case without sending copies to representatives you don’t have? Just having your son’s situation represented in the stack Solomon Yue is taking to the White House would be better than it not being there at all. And there’s no one who can write about it better than you.
Didn’t mean to confuse things in this comment:
http://isaacbrocksociety.ca/2017/09/12/call-to-action-from-republicans-overseas/comment-page-1/#comment-7995641
Democrats Abroad have a taxation survey going, not a petition. Letters, emails, phonecalls, forums, media, congress visits, petitions and surveys … everything helps to build the strength of the pushback to CBT/FBAR/FATCA. Now’s the time because there may never be another time quite as poised for success as this.
Heidi,
It sounds as though you, and others here, have a serious and legitimate concern about TBT. If I were you, I would contact RO and ask if they could clarify the issue about US-source pensions. Here is their website which has a contact form you can use to ask your questions. https://republicansoverseas.com/ It’s possible that you are misinterpreting the proposal but it’s also possible that there is something genuinely wrong with it. Wouldn’t be the first time, as we all know too well!
If RO hear’s about this concern and has an “oops, we screwed up” moment, there are still many days before October 2 that they could actually get their heads together and fix the problem. They definitely should be informed. Whatever you find out, please share with us. Thanks!
Yet another tax survey, this time the Republicans asking you to “Tell Congress what you want from Tax Reform”. It’s kind of limited, but heck, why not add our voices? You’ll have to choose the option “other”, since there’s nothing about CBT:
https://fairandsimple.gop/tell-congress-survey
And the same GOP site contains a second survey, asking “What part of the tax code hurts you most?” in which you have a choice to select “Outdated worldwide tax system”. You have to input a zip code, though. The White House zip code is 20500.
https://fairandsimple.gop/which-part-of-the-tax-code-hurts-you-most
@ Muzzled
Thanks for the link.
I tried to send them my concerns but as is usual for any American organization they expect you to have an American zip code and American phone number even though they are called Republicans ABROAD and they won’t let me post without one!
I’ll try Barbara’s method.
@MuzzledNoMore
You can find previous discussions on the TBT proposal here:
http://isaacbrocksociety.ca/2017/01/06/white-paper-republicans-overseas-on-fatca-rbt/
http://isaacbrocksociety.ca/2017/01/06/republicans-overseas-white-paper-on-territorial-taxation-for-individuals/
And Shadow Raider’s excellent critique of the entire thing is here:
https://drive.google.com/file/d/0B7VqDyDIAgW2UXJHYWZqY0hpTE0/view?usp=sharing
There are indeed several things that are seriously wrong with the TBT proposal. RO were given all of this feedback at the start of the year, and apparently ignored it entirely. It is an open question as to whether they would be more receptive to fixing it at this late stage. If it is fixable at all, that is.
https://twitter.com/SolomonYue/status/908585673153683456
The GOP has a survey now which includes “Outdated “worldwide” tax system” as an option to check off:
https://fairandsimple.gop/which-part-of-the-tax-code-hurts-you-most/?fref=gc&dti=334650186701060
“Drop your email address below”
@ plaxy
My husband has dummy email addresses for just this purpose. I take it “moderate” means not totally liberal and not totally conservative. If it means I don’t like either party very much then that suits the bill.