To keep this simple:
1. Yesterday we have a post making an attempt to quantify (what we all know) is that the United States is using citizenship-taxation” as a tool to extract capital from other nations.
2. We have had a number of posts which reinforce that the Government of Canada has agreed to the imposition of FATCA in Canada. FATCA is the tool to enforce U.S. “citizenship taxation” and is therefore the tool to extract Canadian capital to the United States.
My question is: How can Canada both agree to FATCA and allow U.S. citizens to reside in Canada. U.S. citizens in Canada are being used by the United States as “Weapons of Mass Extraction” (WMEs).
Yesterday, I commented in relation to the cost to the Canadian economy of having “U.S. persons in Canada”:
This is a brilliant piece of work. But, if I may suggest this …
As all economists know, there are:
1. Actual costs (what is detailed in this research);
2. Opportunity cost (the lost of economic opportunity had this capital not been stolen from the Canadian economy).
The “opportunity cost” is likely to be far greater.
This study should be circulated far and wide.
U.S. citizenship is a problem for countries the world over. Canada is particularly affected by this problem. How should Canada deal with the problem? What is the solution?
The best solution is NOT an annual payment of tribute to the USA.
The best solution (assuming there is any payment) would be a one time payment to simply purchase those Canadians affected by this form of U.S. Slavery. Let’s get real here. This is about “buying back the slaves”. But, the purchase should include ONLY those who are Canadian citizens. Those who are U.S. citizens only should be deported from Canada.
A week ago there was an article in the Canadian media about how a professor’s family could not stay in Canada because of the probability that he might impose a burden on Canada’s health care system.
I can’t understand how somehow it’s okay to not allow this family to stay because they would be a drain on Canada’s health care system but allow U.S. citizens to live in Canada.
This study is a quantitative expression of what we all know:
“U.S. persons in Canada” are nothing but Trojan Horse soldiers who exist only to damage to the Canadian economy. Yet Governments in Canada and around the world are either so “willfully blind” or so stupid that they can’t see this basic truth.
I ask the authors of this study to continue their fine work and consider how much the Trudeau Liberals should offer to pay the United States for a permanent “buy out” of those who the U.S. considers to be its property in Canada.
Would the methodology for the calculation be based on both (1) the actual cost of the leakage and (2) the opportunity cost of having the money remain in Canada (3) the cost of impoverishment as detailed in Karen’s comment above?
I once again ask the questions:
1. How can any country both agree to FATCA and allow “U.S. persons” to live in that country?
2. Should the Government of Canada offer the United States a ONE TIME buyout and if so how much should that be?
Any of this would involve the Canadian government actually growing some, like the Swiss apparently have – not continuing to hide behind Harper’s pink skirt.
Swiss diplomats win an exception to FATCA:
If I have read correctly, the figure from Muzzled’s post says the estimated annual capital extracted by the US from Canada is $100,750,000.
Darren Hannah (CBA) gave 2 figures in his FINA testimony that he used to justify the fact that Canada could not afford taking any kind of a hit from not signing the IGA. I will have to get to computer to find but would think this $100,750,000 would need to be taken into consideration.
Sounds like a lot of money to hand over to the Americans every year just so some can keep US citizenship.
Am sure the cost to Canada for allowing the family with the Downs Syndrome child is peanuts compared to this.
Why would Canada NOT consider a way to get rid of a problem like this?
I do not recall the Citizenship court or the Canadian government informing me that I was required to tell the US State Dept. that I was relinquishing when I became a Canadian citizen in the seventies. Therefore, was the Canadian government not delinquent for not fully informing me that I was still required to formally tell the State Department of my intentions? I may be a little naive here but I believe that for their negligence, our government should cover any cost incurred for CLN’s, IRS taxes, accountants and lawyers.
The US state department openly discourages dual citizenship:
…”The U.S. Government recognizes that dual nationality exists but does not encourage it as a matter of policy because of the problems it may cause. Claims of other countries on dual national U.S. nationals may conflict with U.S. law, and dual nationality may limit U.S. Government efforts to assist nationals abroad. The country where a dual national is located generally has a stronger claim to that person’s allegiance…”
It would seem that the US only ‘tolerates’ dual citizenship, and is completely oblivious to the fact that the US government is the single biggest threat to Americans living in other countries. Dual citizenship is our ticket to freedom – not to a loss of US government assistance (which in itself we all know is a big joke).
”The U.S. Government recognizes that dual nationality exists but does not encourage it as a matter of policy because of the problems it may cause. Claims of other countries on dual national U.S. nationals may conflict with U.S. law, and dual nationality may limit U.S. Government efforts to assist nationals abroad. The country where a dual national is located generally has a stronger claim to that person’s allegiance…” This is essentially the Master Nationality Rule.
The US oath of citizenship contains these words:
“I hereby declare, on oath, that I absolutely and entirely renounce and abjure all allegiance and fidelity to any foreign prince, potentate, state, or sovereignty, of whom or which I have heretofore been a subject or citizen……”
That allows the US government to conveniently ignore any foreign government rules, requirements, or obligations because as far as the US is concerned that person has renounced any former citizenship as a condition of becoming an American. The foreign government may see it differently but the US couldn’t care less.
However, when the tables are turned and a US citizen becomes a citizen of another country, in the eyes of the US that person’s US citizenship trumps their new citizenship. So, in spite of what the state dept website says, the US invokes the Master Nationality Rule for duals in the US but totally ignores it when one of their citizens lives somewhere else. How hypocritical and arrogant can they get?
Canada needs to have a special oath of citizenship which is ONLY for US citizens who are becoming new Canadians which goes like this:
“I hereby declare, under oath, that I absolutely and entirely renounce all allegiance and fidelity to the United States, of whom I have heretofore been a citizen.” (We can skip the redundant “abjure” part because only the US government finds it necessary to use such quaint words but it might be a good idea to throw in a “under penalty of perjury” somewhere because the USG seems to be impressed with that.) The Canadian government can then proceed to legitimately ignore any future claim made on that person by the US government, starting with FATCA. What’s good for the goose is good for the gander.
Further to that, before sending anyone’s information off to IRS, the CRA should be required to contact that person or otherwise determine if they are a Canadian citizen. If the answer is affirmative. they must immediately delete the information in that file and tell the bank that sent the info to back off.
@Bubblebustin – As starting as a US Person, I never made that oath, just pledge of allegiance (as a minor) a whole bunch of times. And, I may argue that the injust laws in question has little to do “with liberty and justice for all” or the ideals of America.
As questions are being asked of nations of world where one lives:
How can a country – Australia in my case – both permit double taxation (through tax treaty gaps) AND pretend that tax treaties prevent double taxation? Why do they permit the carry on of this lie to the peoples in their countries and also to their Parliaments who pass such as Tax Treaties and FATCA IGAs?
In Australia The Australian Taxation Office (ATO) lists on their website all manner of tax requirements. Why then does the ATO say on their site that tax treaties prevent double taxation, with no footnote as to the US-Australian tax treaty?
Back to question #2
“Should the Government of Canada offer the United States a ONE TIME buyout and if so how much should that be?” A big problem is that there is widespread denial or obliviousness within the Canadian Government in regards to tax treaty gaps and what is demanded by the US on Canadian soil of Canadians with US roots (heard that reference in an article recently – would not work in Australia).
I love that oath! MUST include that loathesome phrase “under penalty of perjury” they’d put that on ANYTHING
Ja, what’s to happen the first time information is forwarded and that person is NOT a US Person? Should we expect more lawsuits?
Problem is… person’s info wasn’t suppose to be reported… doesn’t find out until maybe crossing customs, arrested or id stolen… or depending on the country… attempts to get money off of them… I have been to countries that require a little oil to help the squeaky wheel move along… its against the law but its the custom if u want anything done
The idea of buying freedom for US persons in Canada may appeal to some Brockers, but deporting those with only US citizenship would throw all Permanent Residents under the bus, many of whom have built a life here and have contributed mightily to this country. Lousy idea. Try again. Actually, don’t. Paying a ransom for some and deporting others is a hellish Sophie’s choice. An idea not worth a moment’s thought.
@ Lake Superior Guy
I wouldn’t want anyone deported either and my comment included permanent residents in the buyout. I just don’t know how big that buyout number would have to be. Any ideas?
Besides, my husband was a permanent resident for many years and I thought he was as valuable then as he is now as a Canadian citizen.
Exactly. So what does he/she do when return. Sue?
Thanks for your comment:
which should be reproduced on this thread, as follows:
@Lake Superior Guy
Thanks for your comment:
Obviously nobody WANTS anybody deported. But, let’s give this “a moment’s thought”.
It strikes me that your comment assumes that there is no difference between permanent residents of Canada and Canadian citizens. To assume that there should be no difference in treatment between Canadian citizens and permanent residents, because permanent residents have built a life here and/or contributed to Canada, is to minimize the differences (whatever they may be) between Canadian citizenship and being a permanent resident.
The Alliance For The Defence of Canadian Sovereignty has brought a “Charter of Rights” based lawsuit against the Government of Canada. The Charter itself distinguishes between citizens and permanent residents in certain key areas. Part of the Alliance Lawsuit is based on the Canada U.S. Tax Treaty which distinguishes between Canadian citizens and others.
In other words, Canadian citizenship does matter. The question is whether, and to what extent, Canadian citizenship should matter in determining how to respond to the FATCA and CBT issues.
In addition, I would point out that there are many permanent residents (including U.S. citizens) who have NOT become Canadian citizens, even though they are eligible to do so.
Do you really think that: A U.S. citizen permanent resident of Canada, who is eligible to become a Canadian citizen, but who has deliberately chosen to NOT become a Canadian citizen, has the same claim to consideration by the Government of Canada that a Canadian Citizen has? To say that they have the right to the same level of protection, because they contribute to Canadian Society or because they built a life in Canada, ignores the difference between citizenship and begin a permanent resident. It also (IMHO) comes dangerously close to valuing an individual based on his/her contribution (taxation anybody?) and NOT on the fact of their citizenship.
As unpleasant as this conversation is, and as unpleasant as these conversations are, there is simply NO WAY that the Government of Canada can allow such a high percentage of Canadian tax payers to be subject to U.S. taxation. It is simply NOT possible. It will ensure that the United States will be unjustly enriched and Canada unjustly impoverished because some Canadian citizen/residents have a “U.S. connection”.
Therefore a solution must be found and that solution must be found sooner rather than later.
From a practical perspective, this unjust transfer of wealth occurs if and only if those “deemed U.S. persons” actually file U.S. taxes and pay taxes according to U.S. law. Therefore (I think I will ignore your suggestion to “not try again”), perhaps one should consider how to prevent “U.S. persons in Canada” from NOT filing U.S. taxes OR if they are filing to ensure that they do NOT pay U.S. taxes.
Here are some suggestions by category:
Category 1 – Ways to prevent “U.S. persons” in Canada from filing U.S. taxes
– simply amend the Income Tax Act of Canada to make filing a U.S. tax return that includes ANY Canadian source income on the return a criminal offense (it certainly is offensive, right?)
– make the professions of “U.S. Tax Preparer” or “U.S. Tax Lawyer” in Canada illegal. Those who violate this law receive an automatic jail sentence (A reason to bring back the death penalty?)
– make it a crime under Canadian law to file a U.S. tax return period.
Category 2 – Ways to prevent “U.S. Persons” in Canada from paying U.S. tax
– simply amend the Income Tax Act of Canada to, generate an automatic Canadian Income Tax, that is the exact amount of any U.S. taxes owing under the Internal Revenue Code (forcing the U.S. to accept that tax as a foreign tax credit)
Of course all of this is a problem only if Canadian residents actually file U.S. tax returns. The current stats suggest that most of them do not. Maybe we are confusing a “theoretical problem” with a “practical problem”.
How about if the Trudeau Government were to adopt a “public service campaign” which advertises:
“Save Canada! Don’t file U.S. tax returns!”
“…dual nationality may limit U.S. Government efforts to assist nationals abroad…”
Fat chance. When the going gets tough, the US embassy folks leave! Even if they manage to show up, it’s all charged back to the individual anyway. No free lunch on the crazy chance it happens.
What a bunch of B.S.
I think that the truth is this: even if a country states it no longer had US people in the system- they have to “prove it” to the bully USA. The ONLY way they can do this (imho) is to disclose ALL accounts (US & otherwise).
It’s the USA skimming data & attempting to create a cash-chute to the dwindling USA sources. Mind you, they could just put the tax rates for the wealthy up where they used to be & achieve far more….
Any reason to NOT think this way?
Good grief, USCA, I’m haven’t gone through what I’ve gone through to stop being US tax compliant. Not only do the risks of non-compliance still exist for me, being non-compliant would make it impossible to completely extricate myself from the US when the time comes to renounce US citizenship.
Or should I stop filing for the greater good of Canada?
Happy April Fool’s Day.
Practically speaking those who are in the U.S. tax system will keep filing. Those who are not in the U.S. tax system may or may not start filing. That is their decision.
But, it’s important to recognize that it is NOT in the interests of Canada for Canadian citizen/residents to file U.S. tax returns. This is the reason why I believe that a “one time buyout” should be considered.
Now just how many classes of Canadians and permanent residents would all this create?
Now I’ve got so much food for thought that I won’t have to eat lunch today. Maybe the problem could be solved by the Canadian government fast-tracking Canadian citizenship for all permanent residents with clinging US citizenship in order to prevent family split-ups just because one member was PR only. I asked the Minister of Citizenship and Immigration back in 2012 to consider fast-tracking (ulterior motive being my husband had a long wait ahead to get Canadian citizenship) but to no avail, of course. There would be even more urgency and need for fast-tracking if this hypothetical buyout ever came to pass. You’d want as many Canadian residents as possible in the no-file zone and ASAP. The goal is to stop the flow of Canadian funds into the US Treasury, once and for all.
“So, in spite of what the state dept website says, the US invokes the Master Nationality Rule for duals in the US but totally ignores it when one of their citizens lives somewhere else.”
My understanding is that the United States were not party to the Master Nationality Rule when agreed and signed collectively in 1930 by the League of Nations so have never been bound to it. Having said that, so many other countries signed up to it so must enforce it (albeit in principle). As it is considered a rule of thumb in international law, the United States would have to respect it in principle but not statutorily. Realistically, putting aside the so-called IGAs, U.S. citizenship cannot prevail over the citizenship of another country where one resides. Try telling a French court that a so-called “U.S. Person” with French citizenship living in France (or anywhere else in the European Union) is not French but American. Common sense will prevail, I am sure of this.
Why isn’t Canada bound by the Master Nationality Rule in the instance of the FATCA IGA since they were a signatory to ithttp://www.refworld.org/docid/3ae6b3b00.html? How can the FATCA IGA override that when the two are in conflict? The Government of Canada should treat CANADIANS as Canadian first and foremost when we are present inside Canada’s borders – and reject any foreign nation’s claims of ownership of the fruit of our labours and our assets and where we choose to award our loyalties.
Why isn’t it an offense for any Canadian politician to refer to Canadians resident in Canada, with US citizenship status as “Americans abiding in Canada” or “American citizens in Canada”?
Master Nationality Rule link http://www.refworld.org/docid/3ae6b3b00.html