FATCA and Australia – Part 1 of 2

1,187 thoughts on “FATCA and Australia – Part 1 of 2”

1. @JC @OZ Brockers, could you all start harping on the ATO asking them how many Australian Citizens with clinging US Nationality were ratted out?

   These civil servents think they are doing something holy, they need to be shamed.

2. OMG, the ATO media release makes them sound so proud of throwing their own citizens under the bus and giving the US the data to start tapping the Australian tax and capital base. Clueless fools and utterly disgusting.

3. “Australia’s tax information exchange agreements have come under challenge in some jurisdictions, most notably the Cayman Islands. Source: News Corp Australia
   The Australian Taxation Office has handed the US Internal Revenue Service details of more than 30,000 bank accounts containing more than $5 billion in the first transfer of information under America’s Foreign Account Tax Compliance Act.

   FATCA is part of a network of international arrangements under which revenue departments around the world have agreed to swap information about each other’s taxpayers.

   The ATO said that in return for supplying the FATCA data, the IRS will give it information about Australians with US accounts that will be used to root out undeclared offshore income. …..”
   
   ATO hands over bank details to US Internal Revenue Service, The Australian.

4. @ato_gov_au

5. @ JakDac,

   Thanks for posting the article from The Australian.

   Unfortunately, we are not allowed to reproduce an entire article without permission of the copyright holder. What is okay is to give the link and post an excerpt or two. So, I deleted most of the article and inserted the link to the newspaper site. If you’d prefer a different excerpt, please post a new comment and I’ll delete the 8.21 one.

6. A good time to be reminded of an ages-old truth, especially since FATCA’s fallout is about to increase exponentially:

   The Greatest Crimes Against Humanity Are Perpetrated by People Just Doing Their Jobs
   http://www.truth-out.org/opinion/item/10476-the-careerists

7. The Australian Government has a lot of experience with “assimilation” programs.

   The toxic trio (FATCA, CBT and FBAR) provides the perfect opportunity for assimilating Yanks. Americans living in Australia will now be forced to renounce US citizenship and become full Aussies or return to their Homeland to collect unemployment.

   Living with enforced CBT will be too much for most of them to bear.

8. Some messaging to ATO:

   https://twitter.com/JCDoubleTaxed/status/646864851944345602

   https://twitter.com/JCDoubleTaxed/status/646864265790406656

   ATO is just a tool of Australian Law approved by Parliament. A strength/weakness of Australia is that they try to be first in things. First to comply with FATCA. They are also early adopters with CRS. That Australian article talked about $1 billion compliance costs with FATCA. I have not received a FATCA letter (have not opened any accounts lately).

   Hopes: That Bopp with Bop em good this month with injunction success. I did see something along the way that a first point of focus for the US Treasury (outside of favorite Switzerland) is Caribbean and South America as priorities. Over the years Republicans have been crimping the IRS budget and it has had an impact. One may only hope.

9. @JDL

   For US Persons, FATCA-forced “assimilation” via renunciation may soon virtually guarantee the impossibility of ever going back “home”. As reported on another thread:

   http://isaacbrocksociety.ca/2013/09/19/question/comment-page-10/#comment-6589294

   Pilgrim says
   September 22, 2015 at 8:11 am

   In conversation with a U.S. consular person recently, I was told that U.S. Border personnel had been instructed to get tougher on persons entering with Canadian passports showing U.S. birthplaces. So what has been their practice may change, with those individuals regularly “pulled over”. Nice country.

10. @JC

    “A strength/weakness of Australia is that they try to be first in things. First to comply with FATCA. They are also early adopters with CRS.”

    Wow, just like the U.K., Canada and New Zealand. We might as well call ourselves the Embarrassingly Obsequious Commonwealth, whose true allegiance is not to the Queen, but to whichever asshole is currently sitting in the Oval Office.

11. It’s weak-kneed Aussie politicians who cower & lick the boots of “their master, USA” at fault, & I agree, it’s sickening. I believe that it’s all about a jockeying for position- AU politico’s look at the wanton “winner-take-all” attitude they see across the pond & they want a piece of that big, greedy, power-hungry pie… yuck.

12. Brave new world…

    Lexology, September 22, 2015: “Australian CRS rules to apply to all foreign residents “

    The draft requires Reporting Financial Institutions to report to the Commissioner of Taxation on relevant account holders resident in any foreign jurisdiction. This is irrespective of whether the account holders are resident in a country which has agreed to exchange CRS information with Australia, and will significantly increase the scope of due diligence currently required under FATCA.

    The draft includes some, but not all, of the modifications to the CRS suggested by OECD materials, and certain Financial Institutions may face less favourable treatment under CRS than under the FATCA rules. Entities have until 9 October 2015 to make submissions to the Australian Government.
    …
    CRS is not FATCA

    There are important differences between the due diligence obligations under FATCA and CRS that mean you cannot simply apply your current FATCA processes to meet your CRS obligations.

    Some companies will find themselves having to report for the first time. Others may have to report on accounts that are not currently subject to FATCA reporting. For example, FATCA provides a specific exemption for certain captive finance companies, which has not been specifically replicated in the CRS.

    FATCA also provides an exemption for reporting with respect to certain equity interests which are regularly traded on an established securities market. The CRS does not contain an equivalent exemption.
    …

13. @Calgary411

    Can someone please explain to me how this is NOT going to be catastrophic for the entire global economy? FATCA + CRS = Mutually Assured Destruction. Who needs atom bombs anymore?

14. Stay-at-home Tresurer. Morrison says that he will not involve himself in international affairs (how about when international affairs impact domestic affairs?). He said he would leave international matters to Finance Minister Mathias Cormann and Assistant Treasurer Kelly O’Dwyer.

    @Deckard1138 Good image for what you describe here:
    http://www.economist.com/news/finance-and-economics/21605911-americas-fierce-campaign-against-tax-cheats-doing-more-harm-good-dropping

15. It won’t be me, Deckard.

    And from your comment in the Media post, you’re so right — the words, *FATCA* and *Intergovernmental Agreement* I’ve never heard uttered by Canada’s Harper. It’s all really creepy that no one really discusses FATCA + CRS and here we are living it.

16. @JC

    Ah yes, that Economist article. I started to skim the comments there again and came across one of mine, which I still stand by:

    Deckard1138
    Jun 29th 2014, 06:23

    Please, let’s all cut the crap, shall we? Especially those apologists for CBT who treat it like some esoteric academic exercise, the same way supposedly learned men, who should have known better, once opined about eugenics.

    It’s really very simple: citizenship-based taxation is America’s Apartheid system. It is repugnant, immoral and indefensible. Since CBT is so clearly irredeemable, there is really nothing to talk about, unless your intellectual curiosity exists in a profoundly amoral vacuum.

    CBT discriminates against a particular group of people on the basis of their place of birth – a characteristic as immutable as the colour of their skin. It labels them, tracks them, intimidates them, criminalizes them and forces them into virtual prisons from which escape is nearly impossible. Worse, the architects of CBT are now co-opting the rest of the world to implement this discriminatory regime for them. It is astonishing and disheartening how quickly and easily this is unfolding.

    Far too many countries, cowed by the 30% withholding stick that the U.S. threatens to beat them with, like the FBAR and OVDP sticks they already beat their CBT victims with, simply refuse to challenge America on fundamental moral grounds and it is wrong.

    The U.S. does not deserve a free pass on CBT and FATCA any more than the old South African government deserved a free pass for its heinous apartheid policies. Yet several ostensibly modern and enlightened nations have rationalized their acquiescence to FATCA by publicly exclaiming that America has the inherent right to tax its citizens in whatever manner it chooses. Well, in a just world it does not, for CBT represents a clear denial of basic human rights and dignity.

    Yes, the global hypocrisy is staggering, especially from countries like Canada. Last year, our Conservative government expelled the consul-general for Eritrea for that regime’s tax extortion efforts against its expats in Canada. Just last week, the same government enthusiastically ushered-in America’s FATCA laws to override our country’s own Charter of rights and freedoms, discriminating on the basis of national origin, gutting federal banking privacy laws and setting the stage for a massive legal challenge which will be fought in our Supreme Court.

    Beneath all the technocratic language about forms, compliance, jurisdictions and enforcement, there is a fundamental truth: these American policies are morally unjust and the world must not condone them any longer. FATCA will be a global disaster unless it is stopped now.

    It is indeed time for the world to say no to the U.S. practice of citizenship-based taxation and to force it to adopt residency-based taxation like the rest of the world. If not, then the world better find a more deserving reserve currency in a hurry – the United States has abused its position of trust for far too long and it needs to be reminded that it is just one nation in a community of nations. The breathtaking audacity of FATCA is simply a bridge too far.

17. Deckard,

    Did me good to read your astute comment on CBT once again. May it one day somehow be used in litigation against US CBT.

18. @ Deckard1138
    I thought that comment of yours sounded familiar and sure enough there it is in my “Best of 2014” document. As bang on today as it was then.

19. @calgary411 and EmBee

    Thanks for your kind words. As I re-read my own comment, I was reminded not only of just how far we’ve managed to come, but how much further we have left to go. Thank goodness we are amongst true friends as we make this long and difficult journey together.

20. @Deckard1138 “Can someone please explain to me how this is NOT going to be catastrophic for the entire global economy? FATCA + CRS = Mutually Assured Destruction. Who needs atom bombs anymore?”

    Easy. FATCA + CRS will solve all budget deficit issues. It will make international commerce easier. It will help people be more mobile across the world, and easily bank wherever they are. It will help competent and well-intentioned governments keep money at home. It will prevent traitors from “safeguarding” their “savings” in “safer” countries (using vile and false pretexts such as political instability & inflation)

    Not.

    😉

21. @Fred….morning……nice to see brockers in a friendly time zone..we get more work done in the day before they even get out of bed…….LOL LOL

    Hey I read your last point……..not realizing it was tongue in cheek…….and I was thinking Fred started the Oktoberfest festivities a little early this morning…..then I saw your NOT.

    You do know that when they piece together FBAR reports with FATCA reports and find mismatches that Uncle Sam is going to persue DOJ litigation against banks worldwide in the Swiss Model.

    The banks bought the rope to be hanged with.

22. Reading the AUST-US FATCA IGA Annex 1 again. 

    The banks upon discovery of US indicia and US reportable account have an option to ELECT to notify the account holder to clarify their US status.

    Read paragraph 3 below:

    3. If any of the U.S. indicia listed in subparagraph B(1) of this section are 
    discovered in the electronic search, or if there is a change in circumstances 
    that results in one or more U.S. indicia being associated with the account, then 
    the Reporting Australian Financial Institution must treat the account as a U.S. 
    Reportable Account unless it ELECTS to apply subparagraph B(4) of this section 
    and one of the exceptions in such subparagraph applies with respect to that 
    account.

    Might be why no one in AUS that I know of, has received a FATCA bank letter to clarify their US status.
    Banks have ELECTED to not notify their US indicia customer

23. @Alby I have heard of questions in case of new financial account.

24. @Alby, ditto in the EU………

    The FIs are going to let the IRS deliver the bad news…………

    Sympathy that your Country was in the first wave.

25. @Alby
    I opened an ANZ account last year and the bank recorded on my application that I was not a US tax resident or US citizen. (The bank teller never asked me if I was or wasn’t a “US person” when I opened the account)

    But they gave me a number to call if that information was wrong – as if I am really going to call that number and rat myself out.

    When do we find out if we have been thrown under the bus by the ATO?

    What a week this has been.

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