The following was submitted in the form of a comment:

I’d like to have some opinions about the bill that I’m writing to replace citizenship with residence-based taxation. Maybe someone could move this to a different page if it gets too long. By the way, I’m about one third of the way through with the relevant sections in the Internal Revenue Code.

1. To define residence, I am using the current substantial presence test with all of its rules and exceptions. This is the definition that is currently used for foreigners without a green card, so I am just applying it to everyone. I am also adding an exception to consider US government or military employees abroad as residents, because their salaries are sourced in the US and they would pay higher taxes if they were considered nonresidents. I am also adding that US citizens and permanent residents who don’t satisfy the substantial presence test may elect to be treated as residents for tax purposes by simply filing the normal resident tax forms (1040). I understand that there are some cases where this may be beneficial, and I don’t want to increase taxes on anyone.

Continue reading →

http://www.noozhawk.com/article/072112_mark_shields_denise_rich_u.s._citizenship/

Just to provide some background Mark Shields is big time “insider” journalist and has been for years. In many ways the current problems the United States is having is because of Washington “insiders” like Mark Shields. He is everything wrong with Washington.

http://en.wikipedia.org/wiki/Mark_Shields

Today, I learned from Raiffeisen that they do not refinance mortgages to “US persons”.

Expatica“We will soon shed those American clients who are taxable in the United States,” bank spokesman Franz Wuerth

On this, the US government writes:

U.S. Department of Housing and Urban DevelopmentHousing discrimination based on your race, color, national origin, religion, sex, family status, or disability is illegal by federal law. If you have been trying to buy or rent a home or apartment and you believe your rights have been violated, you can file a fair housing complaint.

According to the US government, it is housing discrimination and illegal under US federal law to deny an individual a mortgage based on their national origin.   Raiffeisen is responding to US policy and thus the US government is responsible for creating a situation which discriminates against individuals of American origin in violation of US federal laws.  Yet, Raiffeisen is not alone in yielding to this illegal discrimination against Americans pressured by the US government.

Investment EuropeCo-op, another retail bank, also announced it had stopped doing business with its US clients, according to the French news agency AFP.

This problem is not limited to one country.  In violation of US federal laws, the US government is pressuring banks around the world to discriminate against American citizens, denying them the right to have a home.

Bank CainvestBank Cainvest offers private banking services to Non-US clients only.

Royal Bank of ScotlandAny brokerage and investment advisory services described herein are not intended for US Persons. Furthermore, any solicitation on this web site of retail banking services (including accepting and/or soliciting deposits), insurance services, mortgage and/or consumer lending services or credit card services is not intended for US Persons.

SwedbankThe Bank does not offer or sell investment deposit to US persons and the Client hereby confirms to the Bank that it is not a US person. The Bank has the right to terminate the agreement immediately if the Client is a US person or becomes a US person during the term of the agreement.

To counter this problem, the US government has several options:

• Switch to territorial taxation
• Reverse the current policy which is causing illegal housing discrimination
• Finance the homes and provide banking services to US persons abroad
• Encourage and expedite renunciations by paying US citizens to renounce their American citizenship.

Housing discrimination can be reported here.

http://news.nationalpost.com/2012/07/22/eritrea-repressive-african-dictatorship-using-toronto-consulate-to-bankroll-military-un-report/

Canada’s response dare I say has not been all that great.

According to a leaked copy of the UN report, which was expected to be released this week, at least some of Eritrea’s military financing comes from its consulate in Toronto, which levies a dubious 2% income tax on members of the diaspora.

“According to a recent Royal Canadian Mounted Police assessment, which is consistent with the Monitoring Group’s own findings, refusal to pay the tax often results in denial of service or threats against, or harassment of, family members still residing in Eritrea, or possible arrest of the individual should they travel to Eritrea without paying the taxes alleged to be owing,” it said.

The report recounted the case of a man who had immigrated to Canada from Eritrea. Before he could become a permanent resident, Canadian immigration authorities required him to present a valid Eritrean passport.

Since he didn’t have one, he had to apply at the Eritrean consulate in Toronto. But the consulate told him he would first have to pay a tax, which included a contribution to the “Eritrean defence fund.”

When the man responded that he was willing to pay the 2% tax but not the money for the military budget, the consulate refused to renew his passport. He pleaded with Canadian immigration officials, arguing that he would be violating the UN arms embargo if he gave money to the Eritrean military, but they insisted he had to provide a valid passport. He “had no choice but to pay the entire sum,” the report said.

http://www.theglobeandmail.com/report-on-business/super-rich-hiding-up-to-32-trillion-in-offshore-tax-havens-study/article4434057/

Not that interesting but wanted to give everyone a heads up.

Another article about Swiss banks getting rid of clients (dual-nationals included). Interesting that Raiffeisen already announced this at the beginning of the year (following the acquisition of Wegelin). Many Raiffeisen clients are also “societaires” as the bank is a cooperative institution (similar to a credit union) and I wonder how the bank can exclude people who are not only clients, but shareholders.

http://www.lematin.ch/economie/argentfinances/raiffeisen-separe-clients-americains/story/10424823

I already wrote a response to the article, please everyone do so. Unfortunately there is a limit of 400 characters and you need to sign up somehow (with Facebook for example).

What astounds me is that no one seems to have yet sued or filed criminal charges for discrimination (at least that we have heard).

Banque Coop is also mentioned in this article for closing accounts as well. Oddly enough, their motto is “FAIR BANKING”.

A few years ago, Raiffeisen said that it would continue to offer services to Americans in limited circumstances. Also, the BCV (Banque Cantonale Vaudoise) got rid of clients resident in the US, but did not exclude keeping clients living in Switzerland:

http://archives.24heures.ch/actu/economie/bcv-lache-clients-etablis-sol-americain-2010-09-10