129 thoughts on “Standing Committee on Finance Meeting 35 – May 14, 2014”

1. @Dash1729

   That’s motherly love for you. Good for her.

2. One day that son may thank his mom, bubblebustin. I hope so.

3. Indeed, bubblebustin. I should have pointed out that our friend, James Jatras, was quoted as well. Yep, capitulation!

4. http://www.680news.com/2014/05/14/canada-u-s-tax-information-sharing-deal-open-to-abuse-privacy-commissioner/

   But John Richardson, a Toronto lawyer who advises Canadians on the implications of the U.S. law, said the agreement represents a nightmarish situation for about one million Canadians, many of whom don’t even realize they are considered “U.S. persons” by the IRS.

   “This a life-altering, monumental event for them,” Richardson said. “The most frightening question for many of these people is, ‘Are you now or have you ever been a U.S. citizen?’”

   Richardson said the government should refuse to co-operate with the U.S., which — unlike most other developed countries — levies income taxes based on citizenship rather than residency.

5. @All

   The YouTube version is now available at our Isaac Brock Society channel, or right here:

   http://youtu.be/T8NjUpngfxE

6. Thanks for your work on these videos so ALL can view OK, Deckard!!

7. Thanks Deckard!

8. Listening to video again; most definitely Saxton’s question about whether Canada got special provisions other countries do not have.

   Keddy proclaims “You’re either a US citizen or you’re not. You either have a green card or you don’t.” This in spite of the fact that he does say he has never “heard of a US Person.”

9. Keddy’s a bit thick isn’t he, like some homelanders? Then again, my MP’s “thrilled” about all the wonderful concessions Canada fought for under the IGA.

10. Ok, this is worse than I expected. Decided to Tweet Andrew Saxton the answer to his question concerning Canada receiving “special provisions that other countries don’t have.”

    Time to call the CONS on this nonsense that they procurred special exemptions for us. Take a look at the countries listed here:

    Cumulative List of Non-US Pension Funds Exempted by
    FATCA Intergovernmental Agreements (IGAs)

    http://tinyurl.com/m29mbwx

    Big example:
    Japan

    Further, the following categories of accounts established in Japan and maintained by a Japanese Financial Institution are not treated as Financial Accounts, and therefore are not US Reportable Accounts or accounts held by a Nonparticipating Financial Institution:

    1. Employee Retirement Savings Accounts, Employee Housing Savings Accounts, and Employee Savings
    Accounts, established under the Act for Promotion of Worker’s Property Accumulation;
    2. Employee Benefit Savings Insurance, Employee Benefit Savings Trusts, Employee Fund Savings Insurance, and Employee Fund Savings Trusts;
    3. Employee or executive stock ownership plans established in Japan pursuant to Article 1-3-3 (5) of the Order for Enforcement of Financial Instruments and Exchange Law;
    4. Stock ownership plans established for the benefit of significant business partners established in Japan
    pursuant to Article 1-3-3 (6) of the Order for Enforcement of Financial Instruments and Exchange Law;
    5. Accounts or products under qualified employee or executive stock option plans which conform to Article 29-2 or 29-3 of the Act on Special Measures concerning Taxation of Japan;
    6. Individual Savings Account (“ISA accounts”) as defined in Article 37-14(5)1 of the Special Tax Measurement Law;
    7. Employee Retirement Benefit Trusts;
    8. Trusts which are legally required to be established for segregation of funds from the settlors’ own property or the purpose of keeping the funds for repayment in case of the settlors’ bankruptcy;
    9. Employees’ Stock Ownership trusts;
    10. Employee Stock Ownership Plan Trusts;
    11. Specified Accounts Based on the Act on Transfer of Bonds, stocks, etc.; and
    12. Corporate pension insurance, Contributory group annuity insurance, Group endowment insurance, and Group whole life insurance.

11. Not being familiar with how Canada’s Parliament works, I have a couple of process questions.

    It would appear that the House of Commons Standing Committee on Finance has just held a “mini-hearing” on FATCA and the IGA enabling legislation, but that the issue remains buried within Bill C-31. Has there been, or will there be, or can there be a FORMAL MOTION (and vote ?) to separate the IGA enabling legislation from Bill C-31 ?

    Has the Lynne Swanson amendment proposal been FORMALLY submitted ? If not, why not ? How might there be a question of “admissibility?”

    Thanks.

12. John Richardson did, indeed, do a remarkable job yesterday. He stressed the point that there is now no need to rush into pushing this IGA through Parliament. Canada is deemed compliant as we speak. So let’s take the time to get the details right … like exempting all Canadian citizens from its application. Darren Hannah cannot understand why more time is required since arriving at the current IGA has already been a “lengthy and transparent process”! Can you believe he actually said that?! Transparent?? What has the gentleman been smoking??

    Scott Brison told Mr. Hannah that he felt Canada could have negotiated a better IGA. You bet they could have and now they need to amend it to make it right. Nathan Cullen had a spirited exchange in which he held Hannah’s feet to the fire about whether or not people’s private financial information would be passed to the CRA/IRS without their knowledge. I was watching live so I’ll have to go back and watch the video again to find out if that question ever actually got a straight answer!

    I found it encouraging that the hour was fairly “heated” and I particularly appreciated John Richardson’s statement of many Canadians’ most feared question: ” Are you or have you ever been an American citizen?” The McCarthy era reference is, sadly, so applicable.

    Again, wonderful job Mr. Richardson and many thanks to the opposition MPs who did some great work!

13. Hi followed what Hannah said about how much the 30% penalty would cost the banks if they did not comply with FATCA. Is there any way to estimate how much money would flow out of Canada into the IRS if TFSA’s. PFIC’s etc RDSP etc were taxed and the money went to the US instead I=of the Canadian economy would think that the penalities on RRSPs, RIFs alone if they were doubled taxed would be enormous. Also the banks would take a big hit too because they would no longer have those funds to invest.

14. @downtherabbithole,
    Exactly! What many Canadians, including the Conservative MPs on the Finance Committee don’t understand is that it’s not just about individual “US persons” in Canada and their tax obligations to the US. Their ignorance is evident in the question by the MP from Windsor (I think it was) to John Richardson about the “value” of US citizenship — implying that dual citizens should be willing to pay taxes to the US in return for that “value”. What is overlooked is that any taxes a dual citizen pays to the US come out of the Canadian economy. FATCA and the IGA are just tools for the US to increase the amount of money the IRS can suck out of Canada. The real enemy to Canada is US citizenship-based taxation, not just FATCA.

15. I wonder if FINA is still accepting “briefs”? I’m sure more Brockers have made submissions than are appearing here (ignore all 58 KB pdfs — they are not FATCA related):
    http://www.parl.gc.ca/HousePublications/Publication.aspx?DocId=6526468&Language=E&Mode=1&Parl=41&Ses=2
    Obviously it takes time to get the translations done so that could explain why they are not appearing yet. Being a translator in Ottawa guarantees you an income for life (and a tidy pension too I’m sure).

16. @Em, I posted mine a week ago, and got a response within 24 hrs that it would be translated. It still hasn’t shown up yet.

17. I sent a more brief, one-issue submission on May 9th, which I was told would be translated and distributed (although I also sent it to individual Finance Committee members). It doesn’t yet appear. I don’t think there was a deadline and there has not been finality so I would send a submission. The more of us who speak up, the better. If there are just a handful of submissions, it would seem to say ‘not too many of these one million US Persons in Canada seem to have a problem with us passing this baby’.

18. I submitted mine the day before both WhiteKat and Calgary did, and also received within hours notice that it had been accepted. Mine showed up this week. Hopefully they are inundated and are still processing others.

19. @ calgary411
    I remember the ACA effort to get lots of submissions to the Ways & Means committee was pretty successful (template plus opportunity to add your own thoughts). It was all for naught — no action taken — but oh well. I wonder if it’s too late to get something like that rolling or would it just be annoying like those 30 briefs from the lawyers all wanting the same something or other? Anyway I hope at the very least, especially after John Richardson’s testimony, that the FINA committee has come to understand that it can be a risky thing for people to admit their USness now and that’s a big factor as to whether someone will be willing to do a brief. I feel somewhat safe (for the moment) here in Canada with my situation so I threw caution to the wind and just did it but I would not blame anyone for holding back. However, it would be nice if a few with CLNs in hand would send in something — even a briefy brief like KalC did (not on list yet).

20. Nathan Cullen had a spirited exchange in which he held Hannah’s feet to the fire about whether or not people’s private financial information would be passed to the CRA/IRS without their knowledge.

    Can you say what the outcome of that was? It would seem to me to be absolutely critical for
    a) people to know they have been selected to have their financial info forwarded to the US via the CRA. Without this, it could easily happen that the financial info of non-USPs is being incorrectly forwarded.
    b) the criteria used in determining that a person’s info should be forwarded. Without this, there is no way of know if a person was selected due to place of birth, which would likely be a section 15(1) Charter violation.

21. @ tdott
    The banks have KYC (Know Your Customer) but now it is absolutely critical that we KOB (Know Our Bank). We need to know how deep is their intent to be rat-finks and if they will let us know they are rat-finking. This data/info once departed will never be returned. DATA gone is DAMAGE done. The CRA might “say” they will delete wrong reports but you will never know for sure that they did. Governments here and over the border are data misers.

22. The CBA representative who came on second after John Richardson said that the bank “may” pass your account info on to the CRA if you show US indicia. I wonder how this would be viewed as a “good faith attempt” to enforce FATCA, and what kind of assurance is this to account holders? Wink-wink, nudge-nudge?

23. @Em

    Judging by past behaviour, all we KOB our banks will do is whatever it takes to avoid the withholding. Period.

24. @Bubblebustin… “KOB”

    Brilliant but needed. I think many of us are doing that.

    Pity those that do not have a clue and will be sitting in the green comfy chair joking about their place of birth!!

25. @George

    Can’t take credit for that Em-ism! She has some great ones, doesn’t she?