Monthly Archives: May 2014

Added, May 3rd: from Professor Allison Christians’ Tax, Society & Culture blog: Tax, Society & Culture, Allison Christians, Marco G.: “FATCA non-delay delay”

The below notice will require some very close reading by a great number of people.
-Notice 2014-33; 2014-21 IRB 1

Originally announced, AGAIN, on a Friday, when it will get lost in the weekend news.

Reuters, May 2, 2014: Foreign banks get transition period on U.S. tax evasion law

From “innocente” and George:

US Treasury and the mythical Bob Stack blinked today, “U.S. Treasury gives relief to banks for anti-tax evasion law”…

from Jim Jatras:

Interesting news today!

Treasury seems to want to have its cake and eat it too: delay FATCA yet again (since it clearly would be a mess on July1) without appearing to do so. It’s a transparent sign of weakness, stalling for time to get more unconstitutional pseudo-treaties signed. It might actually make things worse. Who knows.

from Just Me:

This is akin to declaring all the IGAs non complete as being a done deal, and so added to the count.

and reply back …

I think this is aimed more an individual FFIs being able to take more time to comply, so as to drive more countries into IGAs – which is the only way they can really enforce this. That’s the paradox: foreign governments (like Canada’s) sign IGAs because their banks are terrified of FATCA, but if they didn’t sign them, FATCA would collapse and there’d be nothing to be scared of.

There’s one born every minute . . .

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.

Continue reading →

New Democrats are calling on the Conservatives to acknowledge the concerns with the U.S. Foreign Account Tax Compliance Act (FATCA) and agree to remove it from Budget Bill C-31.
“Despite broad opposition, the Conservatives are charging ahead with the implementation of this agreement,” said NDP National Revenue Critic Murray Rankin (Victoria). “Serious concerns remain about the potential violation of privacy and constitutional rights, as well as unknown costs to Canadians.”
Bill C-31 moves to implement the Canada-US intergovernmental agreement on the FATCA and also to grant the Minister of National Revenue sweeping powers to make any regulation necessary to carry out the agreement.
“How can the Conservatives justify burying this agreement – that could negatively affect 1 million people and that has nothing to do with the budget – inside a 359-page omnibus bill,” said NDP Finance Critic Nathan Cullen (Skeena—Bulkley Valley).”There’s no excuse. FATCA must be removed from the budget so it can be properly scrutinized.”

http://www.ndp.ca/news/conservatives-must-remove-fatca-budget-bill

http://www.executive-magazine.com/business-finance/finance/fatca-answering-to-uncle-sam

FATCA – Region preparing for Uncle Sam

Forthcoming US rules loom large over Middle Eastern banking sectors

An excellent article by Paul Cochrane, Middle East Correspondent for International News Services.

The word “sanctions” in relation to FATCA seems to be growing in common usage, and this story is no exception:

“If a country is not FATCA compliant it will be financially sanctioned in a new way, ‘the FATCA way’, and the readiness in the MENA is not sufficient in my opinion for a FATCA go-live situation,” said Camille Barkho, chief compliance officer at Lebanon and Gulf Bank.

The potential sanctioning of the Lebanese banking sector is a grave concern in Beirut, given the high degree of the economy’s reliance on banking.

The article also raises the issue of data privacy and security for US citizens in the Middle East:

More pressing in the immediate term is the issue of privacy and the safety of American citizens. “One thing the Treasury has not thought about is how do you protect US citizens? In a country like Lebanon, with Hezbollah and other US designated terrorist organizations, banks will identify US citizens, which could put them at risk,” said the BDL source.

Jim Jatras is also quoted in comments about the negative economic impacts of FATCA on the US:

Further questions may arise if there is a dawning realization about negative economic impacts on the US itself. “What happens when we start shorting payments on our Treasury bonds (TBs) by 30 percent? A sovereign holder is not subject to withholding, but for a private institution, what if the interest payment is done through SWIFT to a commercial bank that has not signed an IGA? Treasury will take the interest,” said Jim Jatras, Manager of RepealFATCA.com, which is lobbying against the law in Washington. “This is the kind of thing that could promote dumping TBs, and affect interest rates and the dollar as a global currency, which are issues nobody has thought out.”