Category Archives: reductio ad absurdum

This was originally posted by Lynne Swanson on Maple Sandbox and includes links to several references. She writes:

“Here are a couple of well researched and presented papers on the economic costs of FATCA.

From a Canadian perspective, Mary Blackhill and McMaster University Emeritus Economics professor Stuart Mestlemen did an excellent analysis of the Costs of FATCA to Canada.

They estimate the annual cost to the Canadian economy is between $120 million and almost $2.6 billion (U.S.) They point out the cost is much higher given the exchange rate.

Of course, there is also the very real human cost, costs to financial institutions, costs to Canadian taxpayers and other costs.

Blackhill and Mestlemen report U.S. tainted people consider the Canadian government:

An appallingly poor protector of Canadian interests, Canadian sovereignty and the Canadian people.

The authors conclude:

As long as U.S. citizenship-based taxation is supported by Canada (and other governments), the United States will continue to hold the world in financial bondage.

From an American perspective, More Than Just Numbers: The Legal Dilemmas and Economic Repercussions of FATCA was written by an American Economics professor Brian Mottl.

Professor Mottl says:

FATCA has led to a parasitic relationship between the United States and foreign institutions where the US benefits from the assets reported, and the foreign financial institutions are bullied…

Professor Mottl reports on the economic costs to the American economy, the violation of the sovereignty of other nations, strained foreign relations and more.

Perhaps the most important point Professor Mottl makes is:

FATCA must be repealed because it violates international law.”

[Do you believe that this article will change the mind of Prime Minister Justin Trudeau? If not, be a witness in our lawsuit. Contact me TODAY at stephen.kish.chair@adcs-adsc.ca If you won’t volunteer, please post comments on this article asking for witnesses.]

The Toronto Star article:

“When the former Conservative government agreed to hand over private banking information of Canadians to the U.S. Internal Revenue Service, the Liberals led the growing chorus of indignation…

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From today’s ipolitics.ca article Lynne Swanson is also quoted. Here is part of the article:

“…Members of the Access to Information, Privacy and Ethics Committee voted unanimously Tuesday to invite Lebouthillier to appear along with Privacy Commissioner Daniel Therrien and Marie-Claude Juneau, privacy coordinator for the CRA…

While prominent Liberals, including Prime Minister Justin Trudeau, criticized the information sharing deal before the election, Lebouthillier has defended it. “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…

Lebouthillier’s position has angered groups that have been fighting the deal such as the Alliance for the Defence of Canadian Sovereignty, which is asking the courts to declare it unconstitutional.

Meanwhile, two Liberal cabinet ministers who had criticized the deal to transfer banking records in the past are no longer calling for it to be scrapped or changed.

Speaking on the way into a cabinet meeting Tuesday, Treasury Board President Scott Brison and Transport Minister Marc Garneau rallied behind the position adopted last week by Lebouthillier.

Brison, who sharply criticized the deal and tried to have it amended when he was Liberal finance critic, said the Liberal government has to work with the agreement negotiated by former Prime Minister Stephen Harper’s Conservatives.

“The previous government negotiated with the Americans on this and we have certainly inherited the situation we have,” Brison told iPolitics. “At the time, the previous government could have negotiated more effectively. The question is where are we now and it is a difficult one to deal with retroactively.”

In 2014, Garneau accused the IRS of trying to get the Canada Revenue Agency to “do its dirty work” through the deal – a deal he now supports. “I take the position that our government is taking now and has been expressed by the minister of revenue,” he said Tuesday…”

elizabeththompson@ipolitics.ca

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.

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Posted on Ipolitics.ca You can add your comments at that website. The title of the article is “Revenue Canada quietly handed 155,000 Canadian banking records to IRS”

[Note that the journalist began article with point that our Canadian Government sent private bank info south before receiving privacy assessment from Office of Privacy Commissioner. Journalist failed to find Liberal Government MP willing to chat but did hunt down Liberal Senator who complained about actions of the Tories.]

The journalist, Elizabeth Thompson, comments on her own article: “The language is not misleading. A number of people I interviewed told me of their efforts to get comments from the new Liberal government since the election – from the same Liberal MPs who commented on this issue before the election. I’m trying once again today for an interview with the Revenue Minister (who has a lot less to do with the budget than the finance minister does) and I will keep trying.”]

THE ARTICLE:

“The Canada Revenue Agency quietly turned 155,000 banking records over to the U.S. Internal Revenue Service during last fall’s election, without waiting for an assessment from Canada’s Privacy Commissioner or the outcome of a court challenge to the controversial move.

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See below March 9, 2016 response of new Liberal Canadian Government to January 21, 2016 FATCA questions raised by NDP Revenue Critic Mr. Pierre-Luc Dusseault (Sherbrooke).

Response comes from Canada Revenue Agency, Minister of National Revenue (who we are suing), Finance Canada, Stephane Dion, and Attorney General (who we are also suing).

SEE THE LINK. The text is in both english and french.

Bottom line: 1) We are still second class — our lawsuit continues; and 2) WE NEED MORE WITNESSES.

— I am amazed that the Prime Minister of Canada allowed this statement to be included in the response, asking Canadians to recognize the public interest of the United States at the expense of the sovereignty of our country:

“…we must resign ourselves to the fact that we are faced with a requirement from the United States and that the requirement corresponds to the public interest of the United States, meaning the integrity of their tax regime.”

— The OPC privacy review was passed on to CRA in January 2016 AFTER the September 2015 turnover of your bank records. In other words, Canada does the privacy assessment AFTER the turnover of private confidential data. See below statement:

“Part (aa): The CRA consulted with the Office of the Privacy Commissioner (OPC). A privacy impact assessment (PIA), which is a policy process for identifying, assessing, and mitigating privacy risks, was completed and submitted to the OPC for review on August 27, 2015. The CRA received the OPC’s recommendations on January 4, 2016 [AFTER THE TURNOVER]. The recommendations do not prevent the CRA from exchanging the required information. A response to the OPC’s recommendations is being prepared.”

Mr. Dusseault is now considering his next step. If you have follow-up questions you would like him to ask Mr. Trudeau (e.g., “…But Mr. Trudeau, what about that pre-election statement you made that Canada’s FATCA IGA legislation is insufficient to protect Canadians? What changed your mind?”) you can email him at Pierre-Luc.Dusseault@parl.gc.ca

United States Secretary of State John Kerry offers this accurate assessment of Prime Minister Justin Trudeau: “It’s clear that the Prime Minister has begun to make his mark on Canada’s future.”

USCitizenAbroad comments on Government response:

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Recently Canada’s National Post said: “Dissent serves a valuable social function: it moderates, brings internal accountability and leads to better decisions because of the value of diversity and the contest of ideas.”

“The dissenter is the one who speaks to the future with a voice pitched to a key that will carry through the years.” and Freedom of Speech is “…the matrix, the indispensable condition, of nearly every other form of freedom” says Benjamin Cardozo.

Melvin Urofsky: ”…the dissent may strengthen the limits of the majority, preventing it from sweeping too broadly — a form of damage control.”

— It cannot be easy to “rule on” on those comments that are “fit to print” and those that cross the highly uncertain fuzzy line into irrelevance or what appears to some to be “unpleasant behaviour” — but all should agree that the “Federal Tax Crimes” blog’s January 22, 2016 policy defining what is appropriate goes too far in a very unhealthy direction.

Jack Townsend at the “Federal Tax Crimes” blog has recently proclaimed a new policy restricting the types of comments permitted to be posted on his site:

“Notice to Readers: Irrelevant and Political or Anti-IRS Comments Will Not Be Approved (1/22/16)

I have in the past routinely approved most irrelevant and political and anti-IRS comments to blog entries.

Today, I received another and my tolerance for such comments has worn thin. I post below the comment that has provoked my reaction.

I remind readers that this is a federal tax crimes blog. It is not a political blog or tax policy blog or any other kind of blog except federal tax crimes. Hence, I will no longer approve comments that are not relevant to the blog entry and that present more political argument or anti-IRS argument than analysis of the law relevant to federal tax crimes issues.

For those of you who want to make political comments or anti-IRS, I recommend that you find another blog which welcomes those comments. For example, you might try the Tax Prof Blog, where Professor Paul Caron posts each day one entry labeled The IRS Scandal, Day xxx (the entry today is The IRS Scandal, Day 988). Each day you will find a posting and, so long as you want to make political or anti IRS comments, he seems more than willing to post such comments on his blog.

Thus, for readers who may be inclined to want to make these comments, please note that henceforth they will not be approved for publication on the Federal Tax Crimes Blog…”

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UPDATE November 18 2015:
 
Poll Added at end of Post – Please Vote!
 

USCitizenAbroad, responding on Brock to a comment from @Andy05, makes the very provocative argument that our friendly cross-border tax professionals, who live with us in our own communities, are really “‘bounty hunters’ who receive a “cut” for turning their victims over to the IRS.”

These are strong words.

Wikipedia teaches that a “bounty hunter” is a person who captures fugitives for a monetary reward (bounty) and is sometimes called in the United States a “fugitive recovery agent”.

Is USCitizenAbroad correct? Here is USCitizenAbroad’s argument:

“@Andy05

A thought provoking comment indeed. Towards the end you write:

Of course many of those cases — like Sidney Jaffe — involve bounty hunters. And if the USG privatises tax collection we might see more of that, perhaps combined with ne exeat republica writs like those served on the Barretts.

Actually, the USG has privatised tax collection. Person after person has said that they have called the IRS and the IRS response has been: “you must consult a tax professional for the answer to that question”.

What this means is that the the “tax professionals” both (1) MAKE THE LAW and (2) ENFORCE THE LAW.

Some thoughts on each.

(1) Tax Professionals MAKE THE LAW
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I feel that USCitzenAbroad’s comment on Eric’s post is deserving of its own post.

The (former) Premier of New Brunswick David Alward, born in Massachusetts (who previously expressed frustration over his IRS tax compliance obligations) has renounced his U.S. citizenship.

USCitizenAbroad now alerts us to the possibility that another Premier, Premier-Elect Rachel Notley of Alberta, may also be a U.S. person.

For the protection of these hapless U.S. persons and that of the Canadian people, should proof of non-U.S. citizenship status be a requirement for accepting public office in Canada for all those who have a U.S. taint?

THE ORIGINAL COMMENT:

@Eric

Thanks for your continued research and attention to detail on this important topic.

Thanks in particular for including the chart of “some” recent renunciants. I note that “David Alward”, (the former premier of New Brunswick), is on that list. I note also that the reason given was his acceptance of his new role as Canadian Consul General in Boston. [I (SK) personally believe that there are other reasons; see below].

This may be a bit of a “homecoming” for Mr. Alward. A Wikepedia entry says that was born in Beverly, Massachusetts and moved to Canada at a young age (a familiar narrative).

http://en.wikipedia.org/wiki/David_Alward

Alward was born in Beverly, Massachusetts. The son of a minister, Alward moved to Atlantic Canada in his youth where he graduated from high school in Nackawic, New Brunswick.[4] Alward received his post-secondary education in psychology in the United States at Bryan College in Dayton, Tennessee.[5]

Mr. Alward’s renunciation of U.S. citizenship is of possible interest for another reason. It was reported in 2011, (and apparently confirmed by Mr Alward) that he was having the usual “U.S. tax compliance problems”. See the following blog post (which appears to have been based on news articles in 2011):

https://expatsinca.wordpress.com/2011/10/12/new-brunswick-premier-david-alward-caught-in-fatca-nightmare/

At least we’re not alone; New Brunswick Premier David Alward is caught in the same broad net that is causing so much stress and lack of sleep for American expats the world over.

Alward, who was born in Massachusetts and spent a few years of his childhood in the US before his family settled in New Brunswick, has issued a statement that he understands the frustration we feel as we sort through years of records to bring ourselves into compliance with the US Treasure Department’s draconian regulations.

“I’ve had to scramble like thousands of other people,” Alward said, adding that he is complying with the U.S. demand for tax returns going back years and detailed disclosures.

“This is a difficult situation for a lot of people. I can tell them I am going through the very same thing they are going through.”

FATCA – which was enacted in an attempt to catch and punish tax evaders, drug lords, and money launderers – casts too broad a net, and is instead causing a great deal of fear among honest, law-abiding Canadian residents who do not owe money to the US. Many, like Alward, have only distant ties to the US.

“I don’t know where it will lead or what our success will be – they have the right to tax American citizens. But the fact is a lot of these people that are in Canada, and I think it’s over a million, most have never lived in the United States and it’s just happenstance they were born there,” added Keith Ashfield, Canada’s former revenue minister and the senior cabinet minister for New Brunswick.

We are not criminals, and we are not tax evaders. We’ve merely committed errors of omission and we do not deserve to lumped in alongside wilful tax evaders.

Such is part of the story of the former premier of the Canadian province of New Brunswick. I wish him luck in his new job.

Mr. Alward is one example of the many Canadians with some kind of U.S. connection in their past. A connection that they clearly regret.

Moving on to current premiers:

As you know, Rachel Notley has just become the NDP premier of Alberta. The following Wikipedia entry includes:

http://en.wikipedia.org/wiki/Rachel_Notley

Notley was born on April 17, 1964[4][5][6] in Edmonton, Alberta, and was raised in the town of Fairview, Alberta, the daughter of Sandra Mary “Sandy” (Wilkinson) and Alberta NDP Leader and MLA Grant Notley.[7][8] She is the sister of Paul Notley and Stephen Notley (author and illustrator of Bob the Angry Flower).[9] Her mother was born in Plunkett, Massachusetts.[10]

It appears that Rachel Notley “may” (further details would be required) have been born to a “U.S. citizen” mother. This of course leads to the tantalizing question for Ms. Notley of:

“Are you, or have you ever been a U.S. citizen?”

The Obama Legacy is such that one of the most interesting things to know about a person has become, is the degree of their “USness”.

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If Canadians bearing the stigma of US taint had any uncertainty about their true place in Canadian society, an announcement today by Stephen Harper should erase any lingering doubts: we are now less deserving of federal government protection than dead meat.

As the Canadian Press reported today:

Prime Minister Stephen Harper is reiterating that Canada is prepared to retaliate in an ongoing trade war with the United States over country-of-origin meat-labelling rules.

Speaking with rural leaders in Saskatoon Thursday, Harper said that retaliation will become essential at some point in the dispute.

American country-of-origin rules require all packaged meat to identify where the animal was born, raised and slaughtered.

Supporters of the law say it better informs U.S. consumers, but opponents argue that segregating animals and tracking them adds costs.

It would appear that the Prime Minister is less concerned about the US-imposed costs of segregating, tracking and labelling US Persons in Canada for their country-of-origin than he is about the same thing for pigs and cattle. Something else to remember come election day.