Douglas Todd’s Vancouver Sun article relating to binational American-Canadian citizens and their complaints about controversial new taxation policies is worth reading.
I do have to say that this–at least the mandatory taxation of long-time Canadian residents and holders of Canadian citizenship who are also Americans by birth–sounds bad. Half of my links on Eritrea relate to the Eritrean government’s much less sophisticated shakedowns of Eritrean diasporids. Or am I drawing too much similarity between the efforts of two different governments to tax their citizens abroad?
The sense of outrage, loathing and emotional tumult displayed by people in Canada who have direct or indirect U.S. connections reverberates on at least three major websites devoted to the battle against the U.S. Foreign Account Tax Compliance Act, best known as FATCA.
Americans in Canada have written about experiencing emotional breakdowns, marital discord, depression and alcohol dependence on FATCA-protest websites such as The Isaac Brock Society, Maple Sandbox and the Alliance for the Defence of Canadian Sovereignty. Using pseudonyms, they have called Uncle Sam a “global bully,” an “oligarchy” and a “desperate fading empire.”
Their fury has been heating up since July 1, when the Canadian government brought into effect a complex agreement with the U.S. that requires roughly a million people in Canada who are considered “U.S. persons” to file U.S. income tax statements — or face severe penalties. While many Americans in Canada will not be out of pocket because of FATCA, many will be hit with extra costs, including capital gains on the sale of their Canadian homes.
Upset with what they see as the Conservative government caving into pressure from the U.S. government in its global quest to root out tax “cheats”, a group of Canadian citizens this week launched a lawsuit in Federal Court alleging the legislation is unconstitutional.
Two Ontario women with roots in the U.S. — Gwen Deegan of Toronto and Ginny Hillis of Windsor — took the risk of attaching their name to the lawsuit, which was sponsored in part by the Alliance for the Defence of Canadian Sovereignty and is being spearheaded by noted Vancouver constitutional lawyer Joe Arvay.
Deegan, who moved to Canada when she was five years old and has never had a U.S. passport, called Canada’s complicity with FATCA “a literal betrayal.” She maintained the country in which she was born, but has no meaningful ties, is “plundering” her retirement savings with an “absurd law.”
One Metro Vancouver man has also come forward with how appalled he is by the behaviour of the U.S. and Canadian governments, even though he’s not a signatory to the lawsuit. James Hamilton, a 55-year-old BC Hydro engineer who lives with his family in Coquitlam, joins many in demanding to know how the U.S. can get away with being the only major country in the world that taxes people based on citizenship, not residency. Hamilton believes the U.S. is engaged in “a big money grab” since its inadequate banking regulations helped throw the world into a financial crisis in 2008.