Thanks to Mr. A for writing this letter and posting it as a comment, originally on the ADCS thread.
Dear Ms O’Brien,
You are quoted in a recent article in the The Lawyer’s Daily (“Federal Court of Appeal dismisses Charter challenge to CRA-IRS agreement to share banking info”, Oct. 4/22) as describing the appellants as “US citizens who happen to live in Canada”.
That may be one way to describe them, but it is distorted and misleading. What if the appellants are also Canadian citizens? What if they have lived in Canada for most or all of their adult lives? What if they have no meaningful connection to the US?
Should their US place of birth and (imposed) US citizenship take precedence over their Canadian citizenship?
People with these personal circumstances are a significant part of the group that the FATCA Charter challenge represents, and are more accurately described as “US born Canadians who live in Canada”.
Approximately 20% of Canadians were born outside of Canada. Should this minority of Canadians have their Charter rights violated just because they were not born in Canada? The Canadian government did not believe so when Eritrea tried to tax Canadians of Eritrean origin several years ago. The Harper gov. expelled an Eritrean diplomat from the country. And yet when the USA is the offender it is allowed.
Eritrean diplomat ordered out of Canada after ‘tax’ on ex-pats
Foreign Affairs Minister John Baird has ordered Eritrea’s consul general, Semere Ghebremariam O. Micael, to leave Canada by June 5, and said whoever replaces him must be prepared to play by the rules.
FATCA violates sections 7, 8 and 15 of the Charter. And yet the perceived risk to our banking system (threat of 30% penalties on US source income to Canadian banks) is the reason that the Court has ruled against the appellants. The financial and economic power of the US takes precedence over the Charter rights of Canadian citizens living in Canada.
You acknowledge that the US is an “outlier in international taxation” with its system of taxation on the basis of residence and citizenship. Yet you are silent on the injustice of this citizenship taxation. Would you wish to have your personal private financial account information reported to a foreign tax service purely on the basis of your place of birth? Would you pay taxes (and accounting fees) on your Canadian earned and taxed income to a foreign country just because you were born there?
You call FATCA a “valid US law that has a legitimate purpose”. This is true when trying to prevent tax evasion by US citizens who reside in the USA. It is an unjust law when applied to citizens and residents of other countries. “Offshore” financial accounts for US residents are local accounts for residents of other countries.
Yet the most that you can do is suggest that FATCA may amount to “extraterritorial overreach”.
Look at the public uproar that forced StatCan to back down on its plan to collect data from some bank accounts anonymously.
And yet the Court and people like yourself feel that FATCA account reporting of a minority of Canadian citizens/residents is not unconstitutional. You must be more forthright and honest, and admit that FATCA is unconstitutional for Canadian citizens living in Canada (who also may happen to be US citizens), but when it comes to American economic power and extortion, Charter rights are overridden.
This post originated from a comment on another thread. It received some reply comments there, which I am moving manually to this thread.
Badger wrote December 18, 2022, at 5:10 p.m.:
RE the author O’Brian’s chosen descriptor for the appellants ( as “….US citizens who happen to live in Canada”).
One inherited Canadian citizenship at birth – by birth to two Canadian parents though her birthplace – by happenstance – was the US during her family’s temporary stay. She doesn’t just ‘happen’ to live in Canada. It is more accurate to say that her US birthplace was what just accidentally ‘happened’. The other appellant was born in the US but was brought to Canada as a child, with her family, and remained here for the vast majority of her life. So again, living in Canada and choosing to stay here permanently wasn’t just happenstance – US birthplace was.
And what does O’Brian make of the example of those born in Canada and who merely just ‘happened’ to also inherit US status from a parent or parents, making them (in certain cases) duals? Would the author argue that extraterritorially inherited or imposed US status by happenstance overrides their Canadian birthplace status while they also actually currently reside on Canadian soil?
I’ve noticed that whenever those in favour of US extraterritorial CBT and FATCA describe those affected outside the US, they conspicuously opt to cast them all as ‘Americans living in Canada’ and appear unable (or I would say; unwilling) to acknowledge that all over the globe every day – including in Canada (!) people can – and regularly are born with two (or more) citizenships – either by imposition or by entitlement. Being born in Canada and having US parentage isn’t a rare scenario, nor one which requires much imagination to envision – but is apparently an occurrence which consistently eludes the keen legal minds of US CBT and FATCA defenders alike.
Complete ignorance of the existence of jus soli and jus sanguinis? Ignorance that many ‘Americans’- including those in Canada are also Canadian citizens? Which citizenship is customarily deemed primary where one is actually physically located? Even UCIS notes that multiple citizenships are possible, and that sometimes one is considered more salient than the US status when in the other country of citizenship (ex. https://travel.state.gov/content/travel/en/international-travel/before-you-go/travelers-with-special-considerations/Dual-Nationality-Travelers.html ).
Seems unlikely that those are concepts that a lawyer would be entirely ignorant of – even if only in a very general sense.
So the choice to use only the limited descriptor “..US citizens who happen to live in Canada” rather than the more accurate; “Canadian citizens who also have US citizenship by birth and who have CHOSEN to reside in Canada for the majority of their lives” seems unlikely to be just happenstance, but a sin of omission.
Badger wrote December 18, 2022, at 5:14 p.m.:
O’Brian also chooses to ignore the question of concurrent Canadian citizenship on Canadian soil and the primacy of that status in the comment that refers only to”individuals who are U.S. citizens ” when referring to the appellants, who are also and I would argue – primarily CANADIANS on CANADIAN soil.
“…“In essence the appellants are insisting that Canada sacrifice the viability of Canadian financial institutions that serve all Canadians in order to protect individuals who are U.S. citizens from a valid U.S. law that has a legitimate purpose. One can complain that FATCA amounts to extraterritorial overreach, but that doesn’t mean Canada’s response is unconstitutional.”…”
Ron Henderson wrote December 18, 2022, at 7:57 p.m.:
The weakness of the argument against FATCA in Canada comes down to the harm, or lack thereof. The absolute worst thing that can happen to a Canadian citizen living in Canada is that a certain amount of their data is sent to the US government: name and other identifying details, year-end account balances, and interest or dividend income. That’s not a good thing, though in most cases it’s very easily avoided by failing to disclose US citizenship. However, FATCA itself creates no US tax obligations, nor does it give the US any greater ability to collect penalties or taxes owing. If Canadian financial institutions demanded to see place of birth then denied services to anyone with US citizenship, that would be a very different situation.
The bottom line is that nothing will be changing about FATCA with its’ co-author in the White house. Similarly there are no votes to be gleaned for our current “leader” in Canada by challenging this legislation.
“However, FATCA itself creates no US tax obligations”
Sounds rather like a US press release, and I believe it was. Indeed, a senior UK politician quoted the same press release to me in response to questions from my MP. Direct courtesy of the US government with their hand up the UK MP’s asp., a puppet. Of course, it fails to mention how outrageous these obligations are in the first place and gives a veneer of being reasonable.
As does so much of this.
You just need to report.
You only pay US taxes when US taxes are higher.
You can set local taxes against US taxes.
Your data is only going to your own government.
It all sounds very reasonable really, meanwhile people are getting basic human rights stomped on and cannot lead full, secure and normal lives outside of US borders. The fact that some can live as US criminals while having their local rights trampled should not be much of a consolation.
The UK government will now be in court to answer questions regarding breaches of the GDPR late next year.
Thanks @pacifica for moving my comments to this thread.
I still get infuriated by the continued deliberate and disingenuous inaccurate dismissal and inaccurate descriptions of Canadian citizens and duals as merely “….US citizens who happen to live in Canada”.
And those who are US citizens but also permanent residents in Canada may have been here for the majority of their lives as well. It wasn’t so long ago that one and/or both countries (ex. https://www.canada.ca/en/immigration-refugees-citizenship/corporate/publications-manuals/operational-bulletins-manuals/canadian-citizenship/overview/history-legislation.html ) held that in order to naturalize one had to give up or be stripped of the other status.
Which in the past left individuals or their family members on the other side of our long shared border potentially stranded if life circumstances changed – particularly in the case of for example, an adult vulnerable family member with a disability that rendered them dependent, but who wouldn’t qualify to be sponsored, or elderly parents who needed care.
“US citizens residing in the UK” has also been widely used by the UK government, it’s carefully chosen language.
The young lady close to me was born a British citizen in the UK, to strip her of basic rights because of where her father came from and to hand her over to a foreign power that seeks to punitively tax her is an outrage.
Mr. A’s letter and Badger’s detailed comments are so good to see as we approach the beginning of yet another New Year with no resolution to our ongoing issue. I know we’re lucky that we don’t, but in our situation it really is a shame that we have no visible characteristic that “outs” us all as “US Persons.” Can you imagine the government reporting to China the accounts of all Chinese-born Canadians? There’d be headlines on the front page, marching in the streets, and the “law” that made it happen would be in the bin within a week.
I don’t know what’s in store, but it is good to see that people are still engaged (some of us in the background) in countering the imposition of the unjust law that has adversely affected us in many ways, some of which surpass the inability to access certain banking services.
Thank you Mr. A for demonstrating the true colours of FATCA. Unfortunately, Canada trades peoples well being for money and their own agenda runs our judges and courts as we have all seen. Looking at Canada now, well, society, honesty and morals are going going gone. Now Mr. Jordan Peterson is now a victim of the same type of government control. Lets see how his charter challenge works out…..
Native Canadian makes some points worth considering in the context of the ADCS’ FATCA IGA appeal, which arose from the Canadian Parliament’s acquiescence to the US government in implementing the US’ FATCA law in Canada. Please keep your replies focused on discussing the role of Canadian government/courts/society in terms of this case. To keep our site on our target issues, comments on topics not related to FATCA/CBT/citizenship may be removed.