September 29, 2014
As we reach the end of September it occurs to me that we are reaching the end of the first four months of active fundraising. I thought it would good for the Directors of ADCS-ADSC.ca to create a blog to communicate with you easily and directly.
We live in exciting times. Our “Stop FATCA” project is certainly exciting. It is also exhausting and full of emotional “ups and downs”.
Our lawsuit started several years ago with an idea. It was an idea based on what “concerned Canadians” could/would do if the Government of Canada:
– Under threats of economic sanction “agreed” to implement FATCA in Canada (the Canada U.S. FATCA IGA was signed on February 5, 2014); and
– Changed Canadian law (as per the IGA) to implement the U.S. FATCA legislation in Canada (the Government of Canada did this prior to the July 1, 2014 deadline).
At the “request” of – a foreign power (the United States of America) – the Government of Canada, enacted laws which:
– made discrimination against certain Canadians (those defined by the U.S. as “U.S. persons”) mandatory;
– required banks to begin a “Hunt for U.S. Persons” (most of whom are also Canadian citizens).
(You might find it interesting to know that Canada is one of a very small number of countries where FATCA is fully operational.)
The purpose of FATCA is to facilitate what the U.S. calls “citizenship-based taxation” but which is overwhelmingly the imposition of taxes on people based on “place of birth”. To put it simply the United States claims the right to levy taxes on people who do not live in the United States and on money earned outside the United States. Furthermore, the taxes are calculated according to the same laws that apply to U.S. residents.
The payment of taxes is only the beginning. The U.S. also claims the right to require non-U.S. residents, under threats of draconian penalties, to file a vast number of “information returns”. One example is FATCA Form 8938 which requires individuals to disclose various assets to the U.S. government. The penalty for the failure to file this form starts at $10,000.00.
In January of 2014, President Obama’s Press Secretary Jay Carney made the disingenuous claim that:
“President Obama doesn’t believe that the circumstance of one’s birth should determine the outcome of one’s life.”
At the same time that these “sound bites” are coming from the United States, the United States is using FATCA to “hunt the world” for people living in other countries (who happened to have been born in the U.S. and do NOT consider themselves to be U.S. citizens). It’s a hunt to impose U.S. taxes and penalties on them. It’s a hunt to force them to disclose many of their assets to the U.S. Government.
This is absurd, unjust, inconsistent with international practice and incompatible with the tax laws of other “sovereign nations”.
This assault by the Obama administration is absolutely unjust. When U.S. “place of birth taxation” was explained to one Canadian she said:
“It’s unfair. It’s unjust. It’s inhumane. I didn’t choose where I was born!”
The “Alliance For The Defence Of Canadian Sovereignty” was formed for the purpose of prosecuting a lawsuit against the Government of Canada to prevent its collaboration with the Obama administration in this: unprecedented, unjustified and unconscionable, discrimination against one group of people based on an immutable characteristic – the fact that they were born in the United States.
During 2014 we have been hard at work on behalf of so called “U.S. persons abroad”.
(1) March 2014 – We sought a legal opinion on the constitutionality (or rather the unconstitutionality) of the Government of Canada’s complicity with the Obama administration’s imposition of FATCA on Canada.
(2) August 2014 – We retained appropriate legal counsel.
(3) August 2014 – We filed the Statement of Claim in the Federal Court of Canada.
FATCA is opposed all over the world by many different people.
But, when it comes to opposing injustice, the simple truth is that:
Some people make things happen.
Some people watch things happen.
Some people ask “What happened”?
Because FATCA is characterized as “tax legislation” or “tax cheat legislation”, most people are NOT interested in FATCA and will be asking, “What happened?” Others are aware of FATCA, don’t like, it but are happy to simply “watch things happen“. There is a small courageous group of people in the world who are taking steps to “make things happen”. They are actively participating in ways that are “big” and “small”. They are doing what they can. They are “making things happen“.
Those of you have contributed to the funding the ADCS-ADSC.ca lawsuit are truly “making things happen“. I want to thank you both personally and on behalf of the ADCS-ADSC Board of Directors. Some of you I have met personally. Others not. What I find amazing is the strength of your conviction and your generosity. The truth is that our lawsuit has been made possible by, and only by, your small donations. Yes, it’s true. It’s your small donations that are making this happen and will keep it going.
As I write you this note, I have the following thought:
The people who are making the donations, the plaintiffs (Gwen and Ginny) and some of the Board of the ADCS-ADSC directors will NOT (as a practical matter) be the ones most affected by FATCA. They are in the category of low income (many of our donors are living off pensions), not U.S. persons, could have lived their lives without anybody ever imagining they might be “U.S. persons” or are U.S. tax compliant. Yet, they either assist in this important cause or finance this important cause.
In other words, it’s the people who are the least likely to be affected by FATCA who are carrying the weight of this lawsuit. I find this troubling.
So far, I don’t believe that we have attracted donations from the people who will be most hurt by FATCA – the vehicle to enforce “place of birth taxation” in Canada. Where are these people? I find it very disappointing that the people who have the most to lose by FATCA are contributing the least to our efforts.
That seems to me to be unfair. So please, if you are reading this post and are worried about the effects of FATCA on your income, your assets, your career, your marriage or your children, it’s time for you to step up to the plate.
Yes, we do need your contributions. Although I am fully confident that we will fund this lawsuit, I ask that those of you who CAN contribute (and many of you have significant assets and income) DO contribute. You will make it easier on the others.
On behalf of myself and the ADCS-ADSC Board of Directors I thank YOU for making our achievements possible.
As a couple of American Presidents were fond of saying:
“We can accomplish anything if we don’t care who gets the credit!”
P.S. It’s important that you realize that our FATCA lawsuit is going to be a marathon and not a sprint. The Government of Canada will spare no expense (using your money) to defend it’s “right” to implement U.S. law on Canadian soil. But, do NOT get discouraged.
As (I think) the Marines would say:
“The difficult we do today, the impossible takes a little longer!”
Thank you for those encouraging words, John. I think about Ginny and Gwen every time I send a cheque to ADCS. I’m grateful for everything the ADCS team is doing and for having the Arvay-Gruber team working on this challenging litigation.
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There are millions of people on a collision course with FATCA. Unfortunately the majority are still either unaware of its approach or incapable of comprehending its potential effects. Thanks you ADCS for for knowing what’s at stake here and acting on it when you did. In the end, your success may be marked by the number of people who remain oblivious of your efforts.
I am one of those not directly affected by FATCA – although I could easily have been. Also, I am not Canadian and have never been to Canada. But your organisation is carrying the torch trying to protect (so-called) “US persons” around the world. I have donated and would urge anyone who has not to PLEASE do so. You can donate anonymously!!
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John, I have met numerous people who I though would really be in the loop on FATCA, and yet they know nothing about it. I suppose the whole notion of it is so egregious it almost requires suspension of disbelief to grasp it, and as a result, people skip to the next section of the news. After all, it couldn’t possibly be ME they’re talking about. I believe once a few people get nailed through FATCA the noise will grow louder. When will the Statement of Defense from the government be public?
That’s right, John Canuck. They must be going after tax dodgers, not me! I pay my taxes where I live, work and benefit from them.
I agree with John Canuck, there are people I have encountered who, judging by the crazed look they give me, think I have two heads or something when I explain the concept of FATCA and the IGA.
By the way, just in my casual conversations among my circle of people, I can probably count about 10 who are sleeping victims who will be awakened by FATCA in a most rude manner at some point, probably by their banks. My hunch is that the numbers of Canadians who have been thrown under the bus is far greater than any predictions I’ve heard.
I recently tried to explain FATCA to a guy, and his response (literally) was to jump out of his chair and tell me “No way. There is no way that can be true. How could that even happen? No way!”. I explained that indeed, “it be true”, and gave him some links to verify the madness. Haven’t heard since. Indeed, his wife, who works at a reporting financial institution, had never heard of FATCA.
[…] John Richardson, ADCS-ADSC Co-Chair and our legal counsel asks: […]
So when does the Canadian government need to reply to the lawsuit? I understand that they have received one extension already.
@JustACanadian My understanding is that new claims–also introducing a new defendant–were filed on Oct 9 a couple of days after your message. I suspect that reset the clock rendering moot any previous extensions. However we are nearing the end of the new 30 day window as well so I hope we see a reply pretty soon. I don’t know anything more than any other member of the public, though.