Treasury Secretary Timothy Franz Geithner has just one business day left to avoid breaking the nation’s tax laws for the eighth time since taking office. (And that’s just counting the times for which there’s publicly-available evidence.) Continue reading
Author Archives: Eric
A celebrity's relinquishment report from Taipei, 2009
This story was published in Taiwan’s Apple Daily last summer; a friend of mine forwarded it to me recently. It recounts the relinquishment experience of Ms. Chi Cheng, an Olympic medalist and Cal Poly Pomona graduate who gave up her U.S. citizenship in 2009 to take up a policy-level advisory job with the government in Taipei under Ma Ying-jeou. (According to Article 28(2) of their Civil Service Employment Act, civil servants are not permitted to hold foreign citizenship.) Translation and my comments after the jump. Continue reading
Two small English-speaking countries with very different reactions to FATCA
In non-Anglophone countries, a lot of the coverage of FATCA is driven by cross-border tax consulting firms — the only organisations with the resources to translate huge volumes of FATCA news into the local language, and the connections to push their version of the story to local journalists on a regular basis. These companies, despite their crocodile tears, are very happy about all the new business that FATCA is going to generate for them in helping customers navigate complex new requirements, and get no benefit by promoting opposition to it.
In Anglophone countries, however, the local journalists have no excuse for not getting their FATCA coverage right anymore; there is a huge amount of material out there about the potential negative effects of the U.S.’ new fiscal imperialism. So it’s interesting to see the sharply differing coverage of FATCA in Ireland — a country with a high presence of cross-border tax sandwich-makers — and Jamaica, where such companies are far less active.
South Korean finance minister sells his country's sovereignty to the IRS, surrenders to FATCA
South Korean tax industry publication Josei Ilbo is reporting that Finance Minister Bahk Jae-wan met with Timothy Geithner at the G20/IMF/World Bank meeting this weekend and came to an agreement on the implementation of FATCA in South Korea. Their journalist has written a shoddy and clueless article which makes no mention of the potential effects on Korean Americans, returned South Korean expatriates still holding on to their green cards, Americans working in South Korea, South Korean privacy laws, or anything else — just the usual cross-border services firm propaganda on “minimising the burdens of financial institutions”. Translation after the jump.
Knocked flat by "horizontal equity"
One of the most common justifications among DC tax professors and policy wonks for taxing US homelanders and US Persons abroad in the exact same way is “horizontal equity”: the idea that “similarly-situated” taxpayers should pay similar amounts to the US government. Naturally, these people see the current situation, in which U.S. Persons Abroad get all these “great tax breaks”, as horribly unfair. So here’s a handy table comparing the paperwork which U.S. homelanders and U.S. Persons Abroad must complete in order to conduct similarly-situated kinds of financial activities. All estimates are courtesy of the Paperwork Reduction Act.
FATCA news from the Kingdom of Jordan
Al-Wasat News, Bahrain’s first independent newspaper, reports on a FATCA seminar held by Deloitte in Jordan. Unfortunately I don’t think we have any Arabic speakers among our readers or commenters who could read the original Arabic article, but you can always try to puzzle your way through Google Translate’s English rendering of it. Deloitte also has an English-language press release about a FATCA seminar they held in Jordan early last month, which may be referring to the same event. Continue reading
Civic groups filling in where the IRS falls down on the job: educating immigrant taxpayers about FBAR and FATCA
Thanks to Congress and the IRS, ordinary taxpayers who migrate from one country to another face incomprehensible tax reporting and payment obligations, involving a burden of time and accountants’ fees all out of proportion to the actual monetary amounts involved. Immigrant and emigrant taxpayers who have failed to comply with these requirements despite their best efforts face huge fines. In response, voluntary groups are picking up the slack and holding seminars at their own expense to warn immigrant taxpayers about the burdens they face. The World Journal, a Chinese-language newspaper based in New York, reports on one such seminar held in Florida this past week. I’ve translated their article below.
Russia forming government task force to look into FATCA deal
Major Russian business newspaper Kommersant reported in an article yesterday that the Russian government, egged on by Association of Russian Banks (of whom we’ve written previously), is looking into the possibility of signing an inter-governmental agreement for the exchange of bank account information, along the lines of the European deal announced in February. The journalist writes as if such a deal were a foregone conclusion, stating that the Russian government is not looking into “whether” but instead “how” to sell out their sovereignty to the IRS. I’ve translated the article below.
Foreign Earned Income Exclusion-killing "Budget For All" defeated
The Congressional Progressive Caucus’ “Budget for All”, which would have repealed the Foreign Earned Income Exclusion, was voted down by 78–346 last week. It was formally proposed as Amendment 4 to H.Con.Res. 112; OpenCongress.org has the roll call. The House passed Paul Ryan (R-WI)’s budget instead. However, regardless of the failure of the “Budget For All”, Americans Abroad Caucus members who voted in favour of it still owe an explanation to U.S. persons abroad.
One-third of Americans Abroad Caucus supports passport-confiscation "highway" bill
Last week, a number of Democrats in the U.S. House of Representatives, including more than a third of the putative members of the Americans Abroad Caucus, co-sponsored the introduction of HR 14, the House version of the Senate “highway” bill S 1813 we discussed earlier. That bill included provisions to let the IRS revoke or deny issuance of a passport, and also to give the U.S. Treasury the authority to illegalise credit cards from banks which they feel are “uncooperative” with the U.S.’ attempts to tax the whole world.
In a comment, Just Me points to some temporary good news: instead of voting on HR 14, House Republicans instead pushed through John Mica (R-FL)’s three-month highway-funding extension bill HR 4281, the ninth extension of the Bush II-era SAFETEA-LU act.