Liberty and justice for all United States persons abroad

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House Finance Committee Q&A today on Canada-US IGA

Posted on by Posted in Issues regarding US persons abroad 104 Comments

As Blaze pointed out on Sandbox, and as I don’t at the moment see elsewhere here on Brock, the House of Commons Finance Committee met today from 3:30 through 5:30 today. Most of the second half of the meeting was taken up by the FATCA IGA, with questions of Finance officials (Shoom and Ernewein) mainly by the NDP, with softball lobs by Conservative members.

I’ll repeat here the comment I posted on Sandbox. I’m not going to subscribe to or respond to any replies to this; I just want to call everyone’s attention to the meeting, how to download a video clip of the entire meeting, and how important it is for Canadians affected by the IGA to watch, listen carefully, and reflect carefully.

I was able to download the two-hour video clip of this meeting at this web link

May 1 Finance Committee meeting

It isn’t quite obvious, but at this link directly under the General Information tab slightly down the page, there is a little link named “Play, Download or Subscribe.” If you click on that, a box pops up which lets you download an audio clip, a medium-res video clip or a high-res video clip in English or French, of the entire meeting. You can also view it on screen without downloading, but I recommend downloading to your desktop and then double-clicking the file once downloaded; in Windows, Windows Media Player will launch the clip. The FATCA (“Part 5”) discussion begins at 1 hour 5 minutes into the meeting (slightly more than halfway through) with Ernewein and Shoom as Finance witnesses (the former did most of the talking). The remainder of the meeting focused on FATCA. The meeting adjourned until, if I understood correctly, next Tuesday when the committee will reconvene with the Minister of Finance for an hour and then a resumption of questions on Part 5 (FATCA IGA) and then eventually some issues in Part 6 of the omnibus bill.

I think it is important to pay attention to this video, because it makes very clear how the government will reply, both in Parliament and I suspect in court if it comes to that, regarding the privacy and charter issues. The NDP pressed these issues very persistently, but the Conservative and Finance spokespersons responded in a way that gave me an inkling of some of the reservations that I suspect Joe Arvay may have raised in his legal opinion about how this might unfold. I’m not convinced the charter issue is going to be a slam dunk; it certainly is going to be an intricate and prolonged debate.

I won’t presume to summarize what was said, everyone can view the video and draw their own conclusions. Listen carefully to what is said, and how it is said, in particular in contemplating how you want to proceed for yourself and your family if you’re an affected so-called US person.

Also note that the Finance spokespeople made it very clear (once again) that CRA is NOT going to be collecting IRS penalties or tax liabilities against Canadian citizens. They made it VERY clear however that Canadian residents who are US citizens and who are not Canadian citizens may very well be collected against as a result of information provided under the IGA, if the IRS comes back to CRA with claims against them for specific tax liabilities (not penalties however).

I think all affected persons need to pay attention to the video I link above, and reflect carefully on what is said in it. Also it’s important to tune into the committee’s next meeting, which I THINK the chair said is next Tuesday, though it’s not on the meeting schedule yet.

I was born and educated in the US. After completing my post-graduate education, I entered Canada on a temporary work permit, moving to Canada because of the Vietnam war. Shortly after unpacking, I applied for landed immigrant status. A few months later I received in the mail an induction notice from the US Army; I drew a peace symbol on it in felt marker pen and mailed it back. As a result, I was indicted and a warrant was issued for my arrest (both were quashed in 1977 by the Carter amnesty). I became a Canadian citizen in 1975. In 1976, for the US Bicentennial I wrote a political letter to Henry Kissinger, then Secretary of State. In it I mentioned that I had "renounced" (I didn't then know of "relinquish") my US citizenship on becoming a Canadian, explaining in several pages my reasons for leaving the US. I also mentioned the fact that on my mother's side I am a descendant of a soldier who fought in Washington's army during the US rebellion, but now I was declaring my personal independence from the US and rejoining the British Commonwealth. Within six months, I received by mail a CLN recognizing my having expatriated myself from the US in 1975. I filed away my CLN and forgot I had it, until I found it after searching for it upon learning of FATCA and OVDI in August 2011. Since then, I proudly keep a photocopy of it with my passport (which is Canadian; I have never had a US passport in my life, nor will I ever). As a Canadian who long since ceased being an American and who has a CLN, I am not directly affected by FATCA or other US taxation outrages. However, my wife and several of her friends are affected, until their relinquishment CLNs (dating from 30-40 years ago) are issued. Also I have several close friends who were born in Canada of US parents and are considered by the US to be US citizens, though they have never lived in the US, worked there, earned income there, held property there, held US passports, or in any other way excercised USC and are horrified they might be considered US. I am active on this website and in writing my elected Canadian politicians about these issues, on their behalf. I am a retired former employee of the Government of Canada who faithfully and proudly served his adopted and adoptive country for many years. Updated September 2, 2012: earlier this week, my wife finally received her relinquishment CLN, State Department formal recognition that (in their exact words on the CLN) she "ceased to be a US citizen on" the date she became a Canadian more than 35 years ago. Mission Accomplished, to borrow words from my least-favourite contemporary/contemptible American. I will continue to monitor this website from time to time to see if I contribute useful information or opinions, but my wife and I are determined to regain our lives after the past twelve months of angst. Best wishes to all of you on this website in your odyssey toward freedom from the US.

104 thoughts on “House Finance Committee Q&A today on Canada-US IGA”

  1. “Also note that the Finance spokespeople made it very clear (once again) that CRA is NOT going to be collecting IRS penalties or tax liabilities against Canadian citizens. They made it VERY clear however that Canadian residents who are US citizens and who are not Canadian citizens may very well be collected against as a result of information provided under the IGA, if the IRS comes back to CRA with claims against them for specific tax liabilities (not penalties however).”

    I’d like to know how CRA is going to determine who they will collect on for the IRS, since they’re not asking for CLNs prior to sending info to, or receiving collection requsts from, the IRS.

    IMO, CRA should be receiving CLNs, in addition to banks.

  2. Wow, a lot was discussed while I was at Canadian Tire. Sorry, folks, no snow here, but plenty of rain…

    @WhatAmI

    I don’t suppose that our MP’s are under any obligation to tell Canadians emigrating to the US about their US tax filing obligations, but if the US is relying on the ignorance of Canadians who assume that the US system is the same as Canada’s in order to entrap them into FBAR penalties, I think there should be some expression of outrage about it. In the words of Marc Garneau MP regarding the FATCA IGA, “Canada should not be doing the IRS’s dirty work for them”.

  3. Also note that the Finance spokespeople made it very clear (once again) that CRA is NOT going to be collecting IRS penalties or tax liabilities against Canadian citizens. They made it VERY clear however that Canadian residents who are US citizens and who are not Canadian citizens may very well be collected against as a result of information provided under the IGA, if the IRS comes back to CRA with claims against them for specific tax liabilities (not penalties however).”

    I’d like to know how CRA is going to determine who they will collect on for the IRS, since they’re not asking for CLNs prior to sending info to, or receiving collection requsts from, the IRS.

    IMO, CRA should be receiving CLNs, in addition to banks.

    The CRA probably know if you are Canadian citizen. They have SIN information So they will not collect against Canadian citizen. If they are missing your citizenship paper you should have birth certificate if Canadian born or naturalization paper if foreign born. If parents are Canadian citizen they can find it.

    You may appeal to the CRA, if you think that a FFI thinks you are still a USA citizen and you are not.

  4. Regarding collection
    You also do not need a CLN to show you are a Canadian citizen,

  5. Thanks, GeorgeIII,

    Now, if this is true, give us this information in plain language, CONSERVATIVE Government of Canada and Canada Revenue Agency!!!

    State clearly and boldly that NO FINANCIAL INFORMATION WILL EVER GO TO THE U.S. IRS FROM CANADA (BE IT FROM A “Foreign Financial Institution” OR THE CRA) IF THE PERSON IS A CANADIAN CITIZEN. That has to be clear, no legal mumbo jumbo. No beating around the bush.

    So, is it true or is it not true?

    Sort of like — Do ALL Canadians have the same rights under the Canadian Charter of Rights and Freedoms? A straight-up, honest clear answer. What is so hard for you to say if that is the case?

    Tell me that my Canadian-born son and anyone like him who does not have the RIGHT to renounce a U.S. citizenship (nor can a parent, a guardian or a trustee on that person’s behalf, even with a court order); someone never registered with the U.S. WILL NOT UNDER ANY CIRCUMSTANCES BE SUBJECT TO U.S. TAX RETURNS OR INFORMATION REPORTING.

    Tell every US-born to Canadian parents but who came back as infants or children that THEY WILL NOT UNDER ANY CIRCUMSTANCES BE SUBJECT TO U.S. TAX RETURNS OR INFORMATION REPORTING.

    Can you boldly stand up for ALL CANADIANS? We are not “Americans who happen to live in Canada”.

  6. GeorgeIII, if just a SIN gets you out of the US tax club, then why are we all so concerned? Has the gov’t stated (or insinuated) nothing will go to the IRS if you have a SIN? Don’t only Canadian citizens have a current/valid SIN?

    Excuse me if I’ve missed something…couldn’t watch the hearing.

  7. @The Mom
    There’s collecting of information. And there’s collecting of taxes and penalties.
    To sort the above comments out, you have to be clear about which “collecting” is being talked about.

  12. Thanks, Em.

    It is great news that Lynne will represent us — bravo Lynne and NativeCanadian if she needs to be transported to Ottawa! Five minutes isn’t long to say what she would like to say. Wonder who the others will be?

    Has anyone seen the timing for tomorrow’s continuation of the House Finance Committee’s discussion on the IGA?

  14. Bravo Lynne, and Maple Sandbox blog which she started. Note the invitation is actually to the Maple Sandbox blog, of which Lynne has been the driving force. This is important for the struggle, for the opportunity to have reasoned voices heard by the Committee, and it is also worth pondering that Sandbox has IMO and perspective always strived for a rational and focused tone in the discussions on that website, which I think has a lot to do with this invitation.

    I’ll be watching the video with great interest on Tuesday late afternoon. As I suspect will we all.

  15. @TheMom,
    You wrote: “GeorgeIII, if just a SIN gets you out of the US tax club, then why are we all so concerned? Has the gov’t stated (or insinuated) nothing will go to the IRS if you have a SIN? Don’t only Canadian citizens have a current/valid SIN?”

    Answer: No, it is not only Canadian citizens that can have a valid SIN. A permanent resident of Canada can also have a valid SIN. So, this piece of data in and of itself is not a reliable indicator of Canadian citizenship. I agree that the Canadian government would have the necessary data to determine if someone is a Canadian citizen, but this would require more detailed checking and what assurance do we have to date that CRA or the Canadian government will actually do this type of checking before sending any financial data off to the IRS?

    @Georgell, @Calgary411,
    I agree with you Georgell that I think the CRA should have clear procedures spelled out that provide for a citizen who is no longer a U.S. citizen to provide them either with a CLN or reasonable explanation of why they don’t have a CLN before the CRA would consider sending any of the person’s financial data to the IRS.

    I think Calgary411 makes some very valid points about what the Canadian government needs to spell out plainly for all. Thanks for raising these.

  17. @ EcstaticCanadian
    So glad to see that so sad frog replaced by such a cheerful gravatar. And what perfect timing to present Lynne’s suggestion for your new alias.

    I hope I didn’t steal Lynne’s thunder by my posting. I wasn’t totally caught up on today’s Brock so I wasn’t sure if it hadn’t already come up somewhere else. This seemed like a good thread for it. Five minutes is going to flash by very fast. I hope they detain her for questioning so she gets a chance to elaborate. We are so lucky to have our plucky Blaze testifying.

    There’s a FINA meeting scheduled for May 6, 2014 — 3:30PM to 5:30PM (Ottawa time). Is that the one?

  18. @Em, It is about time I got rid of that Goofy Sad Frog! So happy to see it go! I think the meeting is May 13th. No I am sure you didn’t steal Lynne’s thunder, she is very excited about it.

    Lynne is going to do a wonderful job!

  21. @Em you beat me to the punch, I was just about to post the May 13 date.

    Interesting that Finance Committee is also meeting tomorrow, and from what I recall of their last meeting, the plan is (at least I think the NDP’s plan is) to continue questions and discussions on the IGA tomorrow. Unless the May 13 date changes that. But it’s possible that the next two meetings of the committee will be devoted to the IGA. Worth tuning into the one tomorrow as well, just to find out. I believe the Finance Minister is going to be taking questions at committee for an hour of that meeting, and I’d be surprised if the Liberals and NDP don’t lob at least one IGA question at him tomorrow. As I’m sure they would have done with Flaherty, were he still alive and Finance Minister.

  22. @ Lynne,

    Appearing before the Finance Committee is great opportunity to effect change and defeat FATCA. Absolutely super that you will be making a representation to the Committee, as you’ve always been really articulate and concise on this topic.

  23. @Em: We have to confirm by Wednesday at noon if we will participate. Finance Canada told me they will give me the names of the other panelists after everyone confirms. I have an idea who two of them are, but I don’t know if there will be others, how many there will be or who they will be.

  25. Tricia has provided a corrected list of the House of Commons Standing Committee on Finance from this source:
    http://www.parl.gc.ca/CommitteeBusiness/CommitteeMembership.aspx?Cmte=FINA&Language=E&Mode=1&Parl=41&Ses=2
    Chair:
    james.rajotte@parl.gc.ca
    Members:
    scott.brison@parl.gc.ca; nathan.cullen@parl.gc.ca; Mark.Adler@parl.gc.ca; mike.allen@parl.gc.ca; Guy.Caron@parl.gc.ca; gerald.keddy@parl.gc.ca; Murray.Rankin@parl.gc.ca; andrew.saxton@parl.gc.ca; dave.vankesteren@parl.gc.ca

    @ Admin.
    Would it be possible to correct my post on May 2, 2014 at 7:32 pm so somebody doesn’t stumble across it first and use it instead? Thanks.

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