RT @peterdahlen #FATCA and Citizen-based Taxation: the way forward http://t.co/ydZzqvopKU – Thanks very much for this!
— U.S. Citizen Abroad (@USCitizenAbroad) June 25, 2013
Secretary John Kerry: “So I think RECIPROCITY in the enforcement of the law is pretty important.”
Now that Snowden let the secret cat is out of the bag, in an interview with Charlie Rose last week, Obama is suddenly looking forward to a national conversation about the balance of security and surveillance. What form it takes is an open question, and you have to ask, why now, when a month ago there was no hint of any such need?
Then today, we have Secretary John Kerry, calling for Reciprocity in enforcement of the law, to cajole Russia’s help in apprehending the ‘bag opener’ that is forcing the conversation that Obama suddenly thinks might be a good idea.
I have to wonder how this zeal will transfer over to FATCA, where others are wanting real reciprocity there also. Those in the offshore investment community are now demanding that Delaware should go first when it comes to Tax Haven reciprocity.
I guess as soon as we have that ‘national conversation’ on FATCA that we forgot to have, reciprocity is right around the corner. Haven’t we just been told publically, by a high administration official in John Kerry, that is is very important?
One small problem, to have that ‘national conversation’ about the DATCA reciprocity we plan to provide, we will have to dig the subject matter out of the bowls of the 2014 Obama budget on page 202 where is currently is hidden in plain sight.
Are you ready for that Congress? You didn’t do it back in 2010, but there is no time like the present to begin.
Obama, you can count me in. Let’s have that ‘national conversation’ about FATCA matched with that DATCA ‘reciprocity’ tit for tat exchange of information where all our financial institutions and non transparent beneficial ownership States chip in. The hunt for the Delaware corporate beneficial owner is the sidekick of FATCA, that we can no longer overlook or ignore. When will it begin? I can’t wait.
It is official, IRS Trust almost restored. It only took 30 days.
Statement Of Secretary Jacob J. Lew On IRS Principal Deputy Commissioner Daniel Werfel’s Report Released Today
6/24/2013
“Our tax code has to be administered with the highest of standards and without bias. Earlier today, I met with the President and Daniel Werfel to review his 30 day report and the progress that has been made to restore the public’s trust in the IRS.
Last month, the President appointed Mr. Werfel, a dedicated public servant who has served presidents of both political parties, as acting head of the IRS. On his first day on the job, I asked him to take three immediate actions, as appropriate, within his first 30 days: 1) ensure staff that acted inappropriately are held accountable 2) examine and correct any failures in the system that allowed this behavior to happen and 3) take a forward-looking systemic view at the agency’s organization.
Today, Mr. Werfel has responded to this directive in his report. Thanks to the hard work of Mr. Werfel and the IRS leadership team, important progress has been made in strengthening the IRS so that it can provide high-quality and fair taxpayer service. Deputy Secretary Wolin and I look forward to continuing our ongoing engagement with Mr. Werfel and the IRS team to accomplish this critical goal.
For instance, since Mr. Werfel’s appointment, the IRS has new leadership in place at all five levels of management responsible for tax exempt applications. Additionally, Mr. Werfel has created a new Accountability Review Board, and has taken action to address the backlog of applicants who were waiting for tax exemption status.
Nevertheless, more work remains. I am committed to taking action to make sure we get this job done. An essential element of restoring the public trust is improving service to taxpayers. To that end, I have asked Mr. Werfel to spend some time outside Washington in the coming weeks to meet with taxpayers, business leaders, and community officials and to uncover new ways to make the IRS more efficient and consumer friendly.
The assessments and actions outlined in Mr. Werfel’s report have charted a path that will improve performance and accountability, and will help ensure that we appropriately address the actions identified by the IRS Inspector General.”
Fact Sheet On Irs Report: “Charting A Path Forward At The IRS: Initial Assessment And Plan Of Action”
GAO Report: Implications of Deleting the Birthplace in US Passports
One more American in Taiwan picks the green passport over the blue one
Update, 24 April 2014: As it turns out, Adam Geller of the Associated Press has finally overturned my prediction that you’d never see Davis’ story in the U.S. media; he interviewed Davis for his story “More renounce U.S. citizenship, but deny stereotype”:
When the team’s owner suggested last year that he join Taiwan’s national team, Davis says he found little motivation to keep his U.S. citizenship. “When you think about who I am as a black guy in the U.S., I didn’t have opportunities,” he says. “You get discriminated against over there in the South. Here everyone is so nice. They invite you into their homes, they’re so hospitable. … There’s no crime, no guns. I can’t help but love this place.”
Geller’s story also contains other familiar names. I’m very happy to see that my initial prediction turned out to be wrong, and that the Isaac Brock Society is succeeding in drawing media attention to the real diversity of motivations among people who decide to stop being U.S. citizens.
Here’s another story you’ll never see in the U.S. media about an American planning to renounce U.S. citizenship to naturalise elsewhere: Quincy Davis, a Los Angeles native & Tulane University graduate who left the U.S. in 2006 to join a basketball team in Cyprus, and now plays in Taiwan. Davis applied to naturalise as a Taiwanese citizen last month so he can represent his adopted home in international competitions; United Daily News reported last week that his application is still in progress. After the jump I’ve translated a longer article from earlier last month about his reasons for naturalising in Taiwan, and the issues he faced.
Davis’s case falls somewhere in between the NBC Nightly News myth of “wealthy traitors fleeing the country to avoid the estate tax” and the more common reality of ordinary people who have lived in other countries for decades and are happy to give up U.S. citizenship to become full members of their societies. Davis is certainly well-off, but nowhere near as well-off as the Homelanders who are moving to Puerto Rico and — unlike actual emigrants — thereafter enjoy a complete exemption from capital gains tax on U.S. assets. And moreover, like nearly everyone else who comes to the decision to give up U.S. citizenship, he left the U.S. as a young adult in the course of pursuing success, put down roots elsewhere, and has a dream to keep chasing after he’s no longer a U.S. citizen.
Continue reading
Has John #Templeton or the US government with #FATCA (and its other wars) done more to help mankind?
Templeton one of greatest philanthropists in history renounced US citizenship and used his wealth to help mankind! http://t.co/FAhB5lmjk2
— U.S. Citizen Abroad (@USCitizenAbroad) June 23, 2013
The article referenced in the above tweet comes from Sovereign Man and is titled:
US Senate to retroactively punish runaway tax slaves.
Surely, the citizens of the “land of the free” could not be slaves! Surely this thought is “crimethink“!
It’s a “fun article” and makes the following point:
Confirmed case of former long-term green card holder not appearing in Federal Register
As we’ve reported previously, since around 2006 or so there have been dozens of newspaper reports and many more internet comments about people who renounced U.S. citizenship but never showed up in the Federal Register. However, the Federal Register is not supposed to include just ex-citizens, but certain ex-permanent residents as well: those who held their green cards for eight out of the past fifteen years.
Up until now, the only ex-green card holders I’d heard of weren’t within the scope of the “name-and-shame list”, either because they’d given up their green cards before the list existed (like Taiwanese president Ma Ying-jeou) or didn’t hold them for long enough (e.g. Constitutional Court judge Chen Be-yue). However, in early 2010, Korea.com reported that 2PM member Ok Taec-yeon had given up a long-held U.S. green card so that he could serve in the South Korean army.
Another Korean-language report states that Ok, who was born in Busan, immigrated to Massachusetts with his family at age 12, which would be some time around 2000; it also has a picture of an old yearbook confirming that “Ok Taec-yeon” is his real name and the same spelling he’s been using all his life, so there’s not much possibility he slipped through in the Federal Register list under a different name — no one surnamed “Ok” has ever appeared in the “name-and-shame list”.
The more money your state gets in federal aid, the more likely you are to think Americans abroad are un-American
Inspired by a recent TaxProf Blog post showing the percentage of each U.S. state’s general revenue which consisted of intergovernmental revenue (primarily federal transfers) in 2011, I went and re-did the same calculation for each U.S. census region based on 2004 budget data, and graphed it against the proportion of native-born GSS respondents that year who lived in that region as teenagers (GSS question REG16) and stated that it was “very important” to live in America most of your life in order to be considered “truly American” (GSS question AMLIVED). As you can see from the graph, the two variables are somewhat correlated, with an R2 of 0.23.
(Edit: Because I made a data entry error, an earlier version of this post left out the South Atlantic region, which is a major outlier — far more anti-emigrant than their low proportion of federal aid would otherwise predict. Without them in the mix, the R2 would be 0.60).
USAs to Move on US Persons in Canada
German Pirate Party opposes US Germany IGA and US “QI” Program: UPDATED with an authorized translation
Pirate Party calls FATCA and Qualified Intermediary program “blackmail”.
http://www.piraten-nds.de/2013/06/03/2329/
At 30.5 Christopher (Chris) Carlson made a short presentation on FATCA on our pirate pulse event. If you could not be there and you are interested in the subject, we hereby provide for you (PDF) its films available.
Direct candidate in WK 42
CC-BY
Also has a follow Christian Szymanek, Direct candidate in WK 42, summarized the issue (Editor’s note: The following translation was commissioned by the author, and made by Dr. C. N. Carlson):
FATCA – America’s Taxes
The land of unlimited possibilities has come up with a new instrument for enforcing its interests in Europe. FATCA – the Foreign Account Tax Compliance Act – compels foreign banks to report customer data to the IRS.
This measure purports to combat tax evasion and actually sounds plausible at first glance. The problems show up when it comes to how the law actually works.
Beginning several years ago, the US has levied a 30% tax on US stocks and bonds held by foreign banks. In order to ransom themselves from this tax European banks must sign an agreement turning them into weirdly named “qualified intermediaries”. As part of this agreement, the banks are obliged to report customer financial data to the US. This is done via the afore-mentioned intermediary: a bank staffer working with a catalogue of secret criteria hands over certain kinds of financial data to unknown third parties, in this case the IRS.
In 2009, the German bank lobby’s brief and futile protest against this extortion ended. As of last year, most German banks had become “qualified intermediaries” and are now conducting the data hunt for Americans among their customers.
So far, so good: all very secretive and using dubious methods, but perhaps you’re thinking, “let them check what their citizens have in German accounts. It’s not my problem, I’m not an American.” Well …
But the search criteria are not limited to US citizens, but to “US persons”. By 2015 the banks must identify all US persons and report their financial data to the US.
By “US person” the USA means not only US citizens and Green Card holders, but also persons born in the US regardless of their nationality. Former exchange students are affected as well as real estate owners, people with business in the US and others.
That’s right: “others”. The US reserves to itself the right to change the definition of “US persons” at any time and for any (or no) reason. It suffices for instance to have stayed there for more than 30 days in a row.
If you’re unwilling to make a declaration to your bank on whether or not you might be a “US person” – or if you refuse to permit your bank to report on you to the IRS, then your bank is obliged to close your account or to refuse to open one or you. You also have to pay an obligatory 30% tax on all dividends and interest income, just to make it easier for the customer to decide to submit. The American FATCA law and American privacy protection standards are thus to apply in Germany – in terms of international law a very dubious proposition. And what does the Federal government do? On May 13th, 2013 we signed the FATCA treaty with the US.
The embassy Facebook page says: Ambassador Murphy signed a treaty to combat tax evasion (FATCA) with representatives of the German Federal government today. Both countries commit to an automatic mutual exchange of information. The treaty will clamp down on the possibility of utilizing foreign financial institutions and services to evade taxes. Together we are sending a signal on behalf of more transparency and tax honesty.
The term “reporting German financial institution” occurs 20 times in the treaty text, the term “reporting US financial institution” occurs only twice, both times only in the term definition, not in the text body. Obviously someone is trying to suggest that this treaty is in the interest of both partners. In fact, a “reporting US financial institution” is postulated which then has no further function in the treaty.
Thus, one cannot say there is a “mutual” exchange, since – as I understand it – the data transfer is strictly one way, nor is the term “transparency” appropriate in the context of this strange mish-mash of secrecy and qualified intermediaries.
This treaty is the opposite of a fair deal: All the disadvantages are on the German side and all the advantages are on the US side. The distinction between German bank customers as so-called US persons and non-US persons, whereby the US persons are to be spied upon and invidiously penalized, appears to be a clear violation of the Constitutional commandment of equal treatment.
The FATCA treaty is one of the last official acts of the US ambassador in Berlin Philip D. Murphy, a former long-time investment banker for Goldman Sachs, the bank which helped Greece hide the truth about its budget problems. Former Goldman Sachs staffers hold a frighteningly large number of leadership positions in Europe and the US. ECB Head Mario Draghi is one of them, as is also Henry Paulson, the former Treasury Secretary and bailer-out of banks during the Bush Administration.
Just imagine for a moment what Goldman Sachs’ investors could do with an unlimited amount of highly confidential European bank data.
For these reasons I call on the German government not to ratify the FATCA treaty.
Christian Szymanek
Pirate Party direct candidate for the German Federal Diet, city of Hannover / 2nd electoral district
(Post originally published at Isaac Brock Society on June 4, 2013)