A comment upon the Economist’s 2 recent articles puts USA policy into black and white:
“Please, let’s all cut the crap, shall we? Especially those apologists for (Citizenship-Based Taxation) CBT who treat it like some esoteric academic exercise, the same way supposedly learned men, who should have known better, once opined about eugenics.
It’s really very simple: Citizenship-Based Taxation (CBT) is America’s Apartheid system. It is repugnant, immoral and indefensible. Since CBT is so clearly irredeemable, there is really nothing to talk about, unless your intellectual curiosity exists in a profoundly amoral vacuum.
CBT discriminates against a particular group of people on the basis of their place of birth – a characteristic as immutable as the colour of their skin. It labels them, tracks them, intimidates them, criminalizes them and forces them into virtual prisons from which escape is nearly impossible. Worse, the architects of CBT are now co-opting the rest of the world to implement this discriminatory regime for them. It is astonishing and disheartening how quickly and easily this is unfolding.
Far too many countries, cowed by the 30% withholding stick that the U.S. threatens to beat them with, like the FBAR and OVDP sticks they already beat their CBT victims with, simply refuse to challenge America on fundamental moral grounds and it is wrong.
The U.S. does not deserve a free pass on CBT and FATCA any more than the old South African government deserved a free pass for its heinous apartheid policies. Yet several ostensibly modern and enlightened nations have rationalized their acquiescence to FATCA by publicly exclaiming that America has the inherent right to tax its citizens in whatever manner it chooses. Well, in a just world it does not, for CBT represents a clear denial of basic human rights and dignity.
Yes, the global hypocrisy is staggering, especially from countries like Canada. Last year, our Conservative government expelled the consul-general for Eritrea for that regime’s tax extortion efforts against its expats in Canada. Just last week, the same government enthusiastically ushered-in America’s FATCA laws to override our country’s own Charter of rights and freedoms, discriminating on the basis of national origin, gutting federal banking privacy laws and setting the stage for a massive legal challenge which will be fought in our Supreme Court.
Beneath all the technocratic language about forms, compliance, jurisdictions and enforcement, there is a fundamental truth: these American policies are morally unjust and the world must not condone them any longer. FATCA will be a global disaster unless it is stopped now.
It is indeed time for the world to say no to the U.S. practice of citizenship-based taxation and to force it to adopt Residency-Based Taxation (RBT) like the rest of the world. If not, then the world better find a more deserving reserve currency in a hurry – the United States has abused its position of trust for far too long and it needs to be reminded that it is just one nation in a community of nations. The breathtaking audacity of FATCA is simply a bridge too far.”
found as comments at:
Those born in the USA or born of USA citizens are not citizens, they are born as SUBJECTS to the Kingdom of USA and subjected to USA’s apartheid.
USA is one of the two countries of the world which tax their citizens and “persons” while they live outside of the borders of their country. After a US person pays taxes in the place he lives, he must file back to the country where he was born (or where only his parents were born!), under threat of penalties and fines. Many of the taxes a US citizen pays to his country of residence may be credited upon his US tax, but not all. Things which are not taxable in the country of residence: pension payments, parental leave payments, unemployment benefits, and any payment or salary not taxed by the local government will be taxed-up by USA.
The tax filing for US citizens overseas is so confusing and time consuming that it is simply impossible to do correctly. And the fines for doing this incorrectly are enormous–up to 50% for each violation (per year retroactive 6 years).