My son is visiting this afternoon and I was telling him about a book I am (finally) reading “The Sovereign Individual” by James Dale Davidson & William Rees-Mogg. Some of you may recognize the title as US Citizen Abroad has mentioned it often. Written in 1997, it is eery in the accuracy with which it predicts what direction the world is headed.

My son responded with this video of George Orwell’s last interview. I don’t know if this has been posted here before but given what is going on in the world right now, I find it spot on. It brought to mind PMSH’s comments about how he will change Canada.

Perhaps Harper was a big Orwell fan as he grew up.

Be sure to look straight at Orwell as he makes his last statement.

Absolutely chilling.

Funny how you can move so quickly on this issue of corporate inversions but not those of American expats. So long then

http://online.wsj.com/news/articles/SB10001424052702303701304579548433123065724?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303701304579548433123065724.html

While they may not be breaking U.S. laws, many of these companies are navigating a loophole in America’s broken and dysfunctional tax code. And while their shareholders may secure a temporary win, workers, taxpayers and this country all lose. America’s tax base erodes at a cost of hundreds of millions of dollars in revenue, increasing the burden on other companies and individuals. America also loses good jobs, talent, investment, and the ability to compete on a global stage.

Legal or not, this loophole must be plugged. Current law requires that U.S. companies reincorporating overseas must ensure that at least 20% of their stock is owned by their new, foreign partner. As chairman of the Senate Finance Committee, I am committed to raising this floor to at least 50% for all inversions taking place from May 8, 2014, on. I don’t approach retroactivity in legislation lightly, but corporations must understand that they won’t profit from abandoning the U.S. (NOTE: Senator what you are proposing is a massive treaty override that Canada and other US Treaty partners should fight tooth and nail).

http://online.wsj.com/public/resources/documents/PaulLetter050714.pdf

“To be clear, I certainly do not condone tax cheats, but I can’t support a law that endangers regular foreign investment and punishes every American in pursuit of a few tax cheats,” he wrote. “Most importantly, I cannot support a bulk collection tax treaty that has complete disregard for the important protections provided to every American by the Fourth Amendment.”

http://blogs.wsj.com/washwire/2014/05/07/rand-paul-fights-tax-treaties-citing-privacy-concerns/

Bucking pressure from businesses and fellow lawmakers, Sen. Rand Paul says he will continue to oppose tax treaties that would let the Internal Revenue Service gather more information about Americans’ overseas financial accounts.

The move dims the outlook for a planned Senate vote on the treaties, while highlighting the Kentucky Republican’s contrarian streak. The treaties – including a significant one with Switzerland – enjoy widespread support among lawmakers of both parties. But Mr. Paul, who is preparing a 2016 presidential bid, believes they would encourage government snooping and erode Americans’ privacy rights.

HOUSE OF COMMONS
2nd Session, 41st Parliament

NOTICE OF MEETING

Standing Committee on Finance

Meeting No. 34
Tuesday, May 13, 2014
3:30 p.m. to 6:30 p.m.
(613-947-7776)

Orders of the Day

Televised

Bill C-31, An Act to implement certain provisions of the budget tabled in Parliament on February 11, 2014 and other measures

Witnesses

3:30 p.m. to 5:00 p.m.

As an individual

Allison Christians, Professor
H. Heward Stikeman Chair in Tax Law, McGill University

Credit Union Central of Canada

Marc-André Pigeon, Director
Financial Sector Policy

Moodys Gartner Tax Law LLP

Roy Berg, Director
US Tax Law

Videoconference – Toronto, Ontario

Investment Industry Association of Canada

Ian Russell, President and Chief Executive Officer

5:00 p.m. to 6:30 p.m.

As an individual

Arthur Cockfield, Professor
Faculty of Law, Queen’s University

Portfolio Management Association of Canada

Katie Walmsley, President

As an individual

Lynne Swanson

Videoconference – New York, New York

As an individual

Max Reed, Attorney
White and Case LLP

I am posting this apart from the cross-post from Sandbox so more people will see it. In addition to Lynne, some familiar faces, Allison, Roy Berg and Arthur Cockfield. It will be televised. Does anyone know how to record this?

Canadians, give your FATCA briefs to Finance Committee

Blaze / Lynne Swanson posts:

Canadians: Make your voices heard at Finance Committee. Give the Committee your briefs!

In preparing my own brief for testifying next week, I learned all Canadians can submit briefs to the Finance Committee–not just those of us who will testify.

Here is what the Clerk of the Finance Committee replied to me when I asked:

Anyone can submit a brief on Bill C-31. While there is no set date it would be best to get it into us at FINA@parl.gc.ca as soon as possible so we can have the briefs translated and distributed to the Members of the Committee before the begin Clause-by-Clause.

Here are the government’s Guidelines for Preparing Briefs: . The Clerk of the Finance Committee has advised briefs must be limited to five pages.

I know many of you already made submissions to Finance Canada in 2012 and again when the IGA was announced. However, those submissions are not being shared with the Finance Committee or with Parliament.

So, if you want those making the decisions to know what you have to say: Give them your briefs.

This should be in your own words. Many of you will be able to adapt the submission you already made.

I have two suggestions:

1. Emphasize you are Canadian!

2. If you support the proposed amendment, include it in your brief.

“Notwithstanding any other provision of this Act or the Agreement, for all purposes related to the implementation of this Act and the Agreement, “US Person” and “Specified US Person” shall not include any person who is a Canadian citizen or legal permanent resident who is ordinarily resident in Canada.”

There is no deadline for this, but clearly, the sooner the better. It may be submitted in either English or French and will be translated. If you speak both languages, you could submit in both.

Tell them what you think. Give Finance Committee your briefs!

Also send your brief to the members of the list of the House of Commons Standing Committee on Finance, updated here:
http://www.parl.gc.ca/CommitteeBusiness/CommitteeMembership.aspx
Chair:
james.rajotte@parl.gc.ca
Members:
scott.brison@parl.gc.ca;
nathan.cullen@parl.gc.ca;
Mark.Adler@parl.gc.ca;
mike.allen@parl.gc.ca;
Guy.Caron@parl.gc.ca;
gerald.keddy@parl.gc.ca;
Murray.Rankin@parl.gc.ca;
andrew.saxton@parl.gc.ca;
dave.vankesteren@parl.gc.ca

The date for the meeting in Ottawa has changed to Wednesday, May 14 from 6:00 pm – 8:00 pm.

The venue is:

St. Paul University
Room 104
223 Main St. (Main & Hazel)
Ottawa, ON K1S 1C4

Parking is available on the street after 5:30 pm otherwise, the cost is $10.00 in the St. Paul parking lot.

See map here.

Continue reading →

When: Today, Wednesday, May 7 at 1:45 pm

Where: Ottawa Centre Block

Link:  http://www.parl.gc.ca/sencommitteebusiness/Notice.aspx?parl=41&ses=2&comm_id=13&Language=E&meeting_id=15043

I just received the official invitation to appear before the Finance Committee as part of a panel. I will try to find out who the other panel members will be. I am also trying to determine if I am able to participate via video or if I need to be in Ottawa in person.

Dear Ms. Swanson,

The House of Commons Standing Committee on Finance would like to invite the Maple Sandbox Blog to appear before the Committee, on May 13, 2014, from 5:00 to 6:30 p.m. (Ottawa time) in relation to its study of Part 5 of Bill C-31 entitled An Act to implement certain provisions of the budget tabled in Parliament on February 11, 2014 and other measures.

Your participation, as part of a panel, consists of an opening statement of up to five minutes, followed by rounds of questions from the members of the Committee. You are invited to review the attached document entitled Guidelines for Witnesses prior to your appearance before the Committee. You could, if you choose to do so, submit a 5-page brief to the Committee. It will be translated as soon as possible, distributed to the members and published on the Finance Committee Website.

Please confirm your presence by responding to this email, by May 6 at noon. Upon confirmation, we will provide you with further details regarding your appearance.

Here is the link to Bill C-31

Cross posted from Maple Sandbox

Related (not from Maple Sandbox)
Additionally, John Richardson will testify before the House of Commons Standing Committee on Finance, on May 14, 2014, from 3:30 to 5:00 p.m. (Ottawa time) in relation to its study of Part 5 of Bill C-31 entitled An Act to implement certain provisions of the budget tabled in Parliament on February 11, 2014 and other measures.

This article in the Washington Times (a conservative newspaper) found by JustMe provides some background information on the Republican Overseas Legal Challenge to FATCA effort.

http://www.washingtontimes.com/news/2014/may/5/superlawyer-jim-bopp-takes-on-mccain-backed-tax-ac/#ixzz30uZESpud

The tweet that was sent out by Michael DeSombre (“Republicans Overseas will be launching legal challenge to FATCA”) did not mention that funds need to be raised for the U.S. legal challenge. I expect that the Republicans will be successful in raising the monies. My understanding is that there will be a separate organization related to Republicans Overseas raising these funds – similar to our own Canadian “ADCS/ADSC”.

Irrespective of whether you like Republicans, or worry about their motives, the world will better off if either Republicans Overseas or ADCS/ADSC is successful in killing the bad FATCA law.

Jim Bopp, the mean bulldog lawyer who would lead the charge mentions here some (but not necessarily all) of the U.S. laws that might be contradicted by FATCA:

Mr. Bopp told The Times that he plans to attack the act on three legal grounds: that it violates the Senate’s sole possession of foreign treaty power, the Eighth Amendment’s ban on cruel or unusual punishment and the 14th Amendment’s personal privacy guarantee.

Some research convinced Mr. Bopp that the act violates the treaty powers that the Constitution grants members of the U.S. Senate. The U.S. government has forged agreements with foreign governments to have their banks reveal all financial matters about their American customers or face huge penalties.

These country-to-country agreements are in effect treaties but ones that no U.S. department or agency bothered to seek the U.S. Senate’s advice on or approval for, he plans to argue.

Finding senators to serve as plaintiffs in a drive to get the Supreme Court to acknowledge the act’s unconstitutionality is task No. 1 for Mr. Bopp and the board of Republicans Overseas.

Mr. Bopp, as general counsel to Republicans Overseas, presented to its board two other constitutional objections: violation of the Eighth Amendment’s prohibition against unusual punishment in the form of gargantuan monetary penalties and violation of the 14th Amendment’s ban on unreasonable search and seizure of the financial assets of Americans abroad.

Republicans Overseas now wants a litigation vs. legislative approach:

“Seeking legal rather than legislative remedy on behalf of Americans living abroad before the scheduled July 1 full implementation of the law is the only available course for now,” said Solomon Yue, the Republicans Overseas chief operating officer and an Oregon RNC member.

The Republican Overseas position differs from that of Republican Senator McCain and Democrat Levin:

Mr. McCain and Mr. Levin see it differently. They not only want to sustain the law, but they also want to strengthen it.

In a joint report by their Senate permanent subcommittee on investigations, the two lawmakers signed on to a call for “the U.S. Treasury and the IRS [to] close gaping loopholes in FATCA that have no statutory basis.”

@George says:

“Can’t you see the pincer movement? The Charter Challenge in the North and the Republican Overseas in the South.”

There was interesting comment by Finance Dept official Brian Ernewein at the very end of last Thursday hearing. At the very end he seemed to indicate that the FATCA 30% withholding would NOT have a significant impact on “regular” or “cash” market operations of Canadian banks but WOULD have significant impacts on Canadian banks cross border “Casino” Over the Counter Derivatives business. This is a rather interesting thing to say as Over the Counter Derivatives were largely viewed as causing the last financial financial crisis and I wonder what exactly is the Canadian public policy benefit to allow chartered banks to engage in OTC Derivatives trading with clients resident in the US/outside of Canada.

Any thoughts?