those who choose to become tax exiles betray the countries that enabled their success
Category Archives: Issues regarding US persons abroad
FATCA and FBAR Reporting by Individuals: Enforcement Considerations from a Canadian Perspective, by Andrew Bonham
I came across this and am now reading. I am posting the “Conclusions” of “FATCA and FBAR Reporting by Individuals: Enforcement Considerations from a Canadian Perspective” by Andrew Bonham in the link below in case others are interested and haven’t yet come across this.
Canadian Tax Journal, Vol. 60, no. 2, 2012
CONCLUSIONSDespite the increasing trend toward judicial comity, the revenue rule and the penal/public-law rule are still the law of the land. With respect to the enforcement of FBAR fines and penalties, since the BSA is not a taxing statute, the revenue rule would not apply, and ultimately any application or action brought by the United States for FBAR enforcement in a Canadian court would be barred by operation of the penal rule. A similar action brought for enforcement of FATCA claims would be barred by both rules.
This leaves the matter of the impact of the assistance-in-collection provisions of the Canada-US tax treaty. Again, since the BSA is not a taxing statute, FBAR collection claims would not fall under the provisions of the treaty. The issue of FATCA individual reporting claims is more problematic. Continue reading
Canada Budget Submissions are UP
Check them there are a lot. I don’t really know who or how many people made FATCA related ones.
U.S. Senate complains about Europe’s extraterritorial “taxes”
A brief interruption from ongoing reports about hypocritical Canadian politicians for this (un)important update about hypocritical American politicians. Via CNBC, we learn that some Congresscritter has been left spluttering by a European Union “carbon tax” being imposed on U.S. airlines through its Emissions Trading Scheme:
Republican Senator John Thune, a sponsor of the measure, said it sent a “strong message” to the EU that it cannot impose taxes on the United States.
“The Senate’s action today will help ensure that U.S. air carriers and passengers will not be paying down European debt through this illegal tax and can instead be investing in creating jobs and stimulating our own economy,” Thune said in a statement.
Back in 2005, John Thune (R-SD) voted in favour of the United States increasing taxes on the EU and the rest of the world with TIPRA and its Foreign Earned Income Exclusion “stacking provision”, resulting in Canadians and Europeans paying down American debt through illegal taxes instead of investing in creating jobs and stimulating the economy.
US Treasury now negotiating with at least 40 countries for FATCA tax information-sharing pacts
From Sept 13 Reuters article:
In February, in the face of industry complaints, the U.S. Treasury Department said some countries could comply by collecting required financial data from their home-country institutions and forwarding it to the United States.
Initially, Treasury said that France, Germany, Italy, Spain and the United Kingdom would be allowed to take this “intergovernmental approach.” Japan and Switzerland were later added to that list under a different model.
The UK on Friday became the first country to finalize a tax information-sharing pact with the United States under FATCA.
The U.S.-UK agreement, pending approval by Parliament, spares UK banks, funds and other financial companies from reporting client information directly to the United States.
Treasury is now negotiating with at least 40 countries for FATCA tax information-sharing pacts, tax lawyers said.
A Treasury FATCA negotiating team is scheduled to meet with foreign financial businesses on Thursday in Paris and on September 26 in Singapore on tax information exchanges.
Bilateral agreements to implement FATCA are “a workaround,” said Mark Matthews, a lawyer at Caplin & Drysdale and former head of the criminal investigation division at the Internal Revenue Service.
Source:
http://www.reuters.com/article/2012/09/18/us-usa-tax-facta-idUSBRE88H15X20120918
Note: Caplin & Drysdale, mentioned above, is home to Scott D. Michel and H. David Rosenbloom, who have written important articles on FATCA. Michel has also testified before the Canadian House of Commons Finance Committee on tax related issues.
Did Doug Ford file his FBAR for his Canadian Assets when he ran the Chicago/US branch of Deco Labels
Given the Ford Family history of ignoring legal requirement and not doing proper paperwork I tend to have my doubts. It would be interesting for the Toronto Star to take a look. Perhaps Linda McQuiag should take it upon herself to start making some phone calls to City Hall. In fact if you look at Doug Ford’s Linkedin page it still says he lives in Chicago and for those who don’t know the Ford Brothers are both multi millionaires. Remember too even if Doug Ford filed a treaty election with the US to still be considered tax resident in Canada he was still required to file an FBAR on any Canadian accounts if he stayed in the US more than 180 days.
Linda McQuaig and Neil Brooks Traitors to Canada on FATCA
I just came across this and my hands a shaking as I type this up. From the book Billionaires’ Ball: Gluttony and Hubris in an Age of Epic Inequality.
I can’t copy past the exact text but if you go to the link you will see what I am talking about McQuaig and Brooks both criticise Canadian Banks and the Harper government for speaking out against FATCA(without any acknowledgement of the NDP’s role too). Both indicate that Canada has an obligation under the “laws of nature” and “societal justice” to help the United States get financial information on its citizens due to the huge degree income inequality in the US.
Neil Brooks
http://www.osgoode.yorku.ca/faculty/full-time/neil-brooks
http://en.wikipedia.org/wiki/Linda_McQuaig
Linda McQuaig is a famous Canadian writer and journalist who worked for the Toronto Star and famously broke the Patti Starr case(relating to an Ontario Liberal MPP engaged in illegal campaign fundraising)
To McQuaig and Brooks I will see to it that your public reputation in Canada will become dirt if the two of you don’t recant public statements in favor of FATCA. I also think the NDP has to make a decision to acknowledge whether these individuals are NDP members and if so whether they should be expelled from the NDP.
Canadian Financial Services Sector Comment on FATCA Draft Forms
I posted this on another thread, but it really deserves its own post. This submission was recently made to the Office of the Chief Council and Associate Chief Council (International) to the IRS and prepared jointly by the Canadian Bankers Association, the Investment Funds Institute of Canada, and the Investment Industry Association of Canada. It brings up key sticking points in draft forms W-8IMY, W-8ECI and W-8EXP that are “predominantly technical in nature“, and again points out how FATCA’s devil is in the details.
As Badger notes:
“Interesting points about the legal/illegal use and disclosure of SIN numbers, privacy, and Canadian law, as well as the issues of official versions of all those forms and instructions in languages other than English. Specifically French language in Canada, as we are officially a bilingual country, but the CBA document also mentions in passing that other languages would be required – which of course would be the case when FATCA is being imposed on the entire world. Currently the IRS forces those in other countries to bear the significant cost of providing taxpayer submissions and filings plus supplementary documents translated to IRS satisfaction, by certified translators. Those service don’t come cheap.
And I am wondering also, how do US IRS requirements for duals intersect with sovereign rights of Canadian First Nations re taxation? Presumably there are dual Canadian citizens/US persons who are also First Nations individuals.”
September 20, 2012 FATCA Commens from Canadian Financial Industry
Eritrea to Canada: Not so fast, We Have the Right to Tax our Citizens
“We have to tax our people, it is our right,” Semere O. Micael, the Eritrean consul in Toronto, said after the National Post reported that Ottawa had sent a diplomatic note to his government making it clear he would be sent home if he continued to run the tax scheme.
Asked to respond to the consul’s comments, Foreign Affairs Minister John Baird’s press secretary Rick Roth said: “We have made our position on this matter to the Eritreans clear, and we expect that to be respected. The government of Eritrea should not test our resolve on this matter.”
My My My This is becoming awfully interesting. I have to wonder for a whole bunch of reasons whether the US State Department is really thrilled with Canada’s actions including for reasons that have nothing to with the US’ own taxation policies. For one thing Canada is picking a fight with a country that is not exactly in the most stable part of the world over an issue notwithstanding Susan Rice’s US Security Council Resolution the US has not appeared to be nearly as willing to go to that mat over. Canada is essentially in some form promoting a customary international law position against citizenship based taxation something at some point the US State Department will have to notice. Canada does have a history of taking “principled” position in this part of the world over international affairs. When the movie Argo comes out in October everyone will be reminded of Canada’s role in the Iran Hostage Crisis. There is also of course Canada’s longstanding ties to Ethiopia which Eritrea was once part of before 1991. Some of you might be remember the Ethiopian Famine and the relief effort started by Brian Mulroney, Joe Clark, and Stephen Lewis and Joe Clark’s famous 1984 visit to Ethopia breaking the western blockade of the then Ethiopian Marxist government. However it is not clear in the present the Ethiopian Canadian relations are much better John Baird for example made a highly publicized but unsucessful visit to Addis Abbaba to win the release of a Canadian citizen being held in a Ethiopian jail. There is also the more recent expulsion of Iranian Diplomats from Ottawa.
Another paragraph in the article should also be observed:
David Matas, an international human rights lawyer who has been assisting Eritrean refugees in Winnipeg, said the consulate was not complying with the substance of Canada’s request.
“To me, that’s making light of the government request. It’s not treating it seriously. It’s trying to play fast and loose. It’s basically trying to pull a fast one on the government of Canada,” he said.
David Matas is not just any old international human rights lawyer he has BIG TIME connections to the Conservative Party of Canada, Jason Kenney, John Baird, and the Harper PMO. My message to the Eritrean government is David Matas is not someone you want to mess around with in Canada. Read any of Paul Wells pieces in Maclean’s magazine about the Rights and Democracy NGO and Aurel Braun.
NPR: The Downside Of Tax Havens? Paperwork.
NRP’s Morning Edition, and Planet Money have continued a series they are doing on Offshore Tax Havens. This provides an opportunity to educate NRP readers and journalists, that some of the issues they talk about also apply to Americans Abroad. Here is the link to their most recent story.. Continue reading