# Citizenship taxation



## iota2014 (Jul 30, 2015)

From Allison Christians's blog at Tax, Society & Culture:



> *Uncle Sam Wants...Who?* At UBC Law This Week
> 
> This week I will be in Vancouver to present a paper at the UBC Allard School of Law. The paper, "Uncle Sam Wants...Who? A Global Perspective on Citizenship Taxation," is now available in draft form on SSRN. Here is the abstract:
> 
> ...


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## Alltimegreat1 (Feb 25, 2015)

Sounds interesting. Maybe you could provide a bit more information about the solution to this problem that you'll be suggesting in your paper.


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## iota2014 (Jul 30, 2015)

Alltimegreat1 said:


> Sounds interesting. Maybe you could provide a bit more information about the solution to this problem that you'll be suggesting in your paper.


Not my paper, Allison Christians's paper. If you want to offer her comments or ask her questions, after reading her paper, you can do so at Tax, Society & Culture


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## Bevdeforges (Nov 16, 2007)

Why the big interest in this particular blog site?
Cheers,
Bev


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## iota2014 (Jul 30, 2015)

Bevdeforges said:


> Why the big interest in this particular blog site?
> Cheers,
> Bev


I'm interested in what Allison Christians says about citizenship-based-taxation because her analysis and description of the problem chimes with my own feelings of shock and dismay when I first heard of CBT, and FATCA, last summer. I'm not an "accidental American", having been born in the U.S. to two citizen parents. But no one ever mentioned Citizenship Based Taxation, and in those days the chances of my learning about it by accident were zero to non-existent.

To quote from the paper:


> It is universally understood that everyone has the right to know
> what the law is.


Citizenship-based-taxation, as variously enforced/not enforced by the US, and FATCA as implemented violates this. I say "FATCA as implemented", because I actually think FATCA could be a good thing if implemented carefully and fairly and multilaterally.


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## JustLurking (Mar 25, 2015)

iota2014 said:


> ... I say "FATCA as implemented", because I actually think FATCA could be a good thing if implemented carefully and fairly and multilaterally.


Perhaps the Common Reporting Standard? The US has not (yet?) signed up to it.


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## iota2014 (Jul 30, 2015)

JustLurking said:


> Perhaps the Common Reporting Standard? The US has not (yet?) signed up to it.


Something like that. The trouble is, CRS has the benefit of voluntary multilateral consent, but the disadvantage that without America it will be difficult to enforce.


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## jbr439 (Nov 17, 2013)

iota2014 said:


> Something like that. The trouble is, CRS has the benefit of voluntary multilateral consent, but the disadvantage that without America it will be difficult to enforce.


Resulting in the US being the one major tax haven left standing?

The US and Its “Reciprocal” IGAâ€™s â€“ Oh, Really? Â» Let's Talk About: US Tax


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## iota2014 (Jul 30, 2015)

I wonder if any of the signatories ever supposed for a moment that there would be reciprocity. The revenue agencies in the 1A countries have parliaments to placate. Claiming it's a reciprocal deal smooths the path.


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## BBCWatcher (Dec 28, 2012)

Let's tear this apart a bit....



> Across the globe


Across a substantial fraction of the globe. Many governments and many banks are nonparticipating.



> banks are flagging accounts with indicia indicating their owners may be “US Persons,”


Yes, and also flagging accounts with suggestions their owners may be evading taxes domestically, laundering money, engaging in illegal drug trafficking, financing terrorism, or not paying their TV license fees, as examples. This is called "Know Your Customer" (KYC).



> making it possible for the United States to enforce its taxation of nonresident citizens extraterritorially for the first time in history.


First time in history? Now that's some mighty hyperbole.



> The indicia method constitutes a mining expedition for US citizens carried out by foreign banks and governments.


For U.S. persons, actually.



> Establishing a tax jurisdiction in this manner is unprecedented and has significant practical and normative consequences.


It isn't establishing "tax jurisdiction." It's merely _suggestive_ of tax jurisdiction. The IRS, subject to judicial appeal and review, and under U.S. law, adjudicates tax jurisdiction. Moreover, about 94% of the time tax jurisdiction exists there's no actual tax owed.



> In the case of so-called “accidental Americans,”


What's an "accidental American"? And who calls them that? It's generally a bad idea to put a term few people understand in an abstract without defining it.



> it violates one of the most fundamental and universally- acknowledged tenets of taxpayer rights, namely, the right to be informed about what the law requires.


The law requires that U.S. persons comply with tax and financial reporting requirements, and those requirements are well documented -- or at least as well documented for every U.S. person as for any other, especially in the age of the Internet. But if my neighbor calls the IRS hotline and reports that I have six whirlpool tubs in my 8 bedroom house while I'm collecting Food Stamps, my neighbor doesn't actually have any obligation to provide me with a copy of the U.S. tax code. I'm not sure what the author is driving at here.



> Third party indicia-searching should be universally rejected as a means of identifying a taxpayer population.


Why? Tax agencies around the world have been doing this for decades. The author doesn't think the Italian tax agency (for example) should be allowed to search Facebook (a third party) for Ferraris? Or that the Singaporean tax agency can't accept reports from concerned neighbors about the cigarette smuggling business that somebody is running next door? I'm not sure what the point is.



> Instead, the United States itself is responsible for cataloguing, informing, and educating its global population of taxpayers.


Which it still does, although maybe the author will join me in asking Congress to increase the IRS's funding so they can do a better job?



> Those who don’t belong in the system should be allowed to opt out without cost.


Those who aren't U.S. persons have no U.S. obligations, and you can't get lower cost than that.

I can't make sense of the abstract, to net it out.


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## jbr439 (Nov 17, 2013)

Accidental American: Let me google that for you 

The wikipedia page seems as good as any: https://en.wikipedia.org/wiki/Accidental_American

As can be seen, "accidental American" is far from being an unknown term (see articles by CNN Money, Forbes, Barron's, etc). Even Obama's proposed budget gave a limited nod to certain AAs.


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## BBCWatcher (Dec 28, 2012)

A general audience doesn't know what the term means, and it isn't in the OED. I wouldn't use it in an abstract without defining it.

It's also not a good sign when even Wikipedia has to begin its explanation with "not to be confused with...."


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## iota2014 (Jul 30, 2015)

jbr439 said:


> Resulting in the US being the one major tax haven left standing?
> 
> The US and Its “Reciprocal” IGAs - Oh, Really? Let's Talk About: US Tax


Elsewhere, the IRS letter replying to Rep. Posey has been posted. (Googling "IRS letter Posey" should find it.). It's quite amusing in a caught-with-their-pants-down kind of way. 

But more than a grain of truth in the IRS argument that (to paraphrase) they were ordered by Congress to do the impossible.


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## JustLurking (Mar 25, 2015)

BBCWatcher said:


> I can't make sense of the abstract, to net it out.


You are not supposed to "make sense" of a paper's abstract in isolation. Please read the entire article before questioning its conclusions.

https://en.wikipedia.org/wiki/Abstract_(summary)
"_An abstract is a brief summary of a research article, thesis, review, conference proceeding or any in-depth analysis of a particular subject and is often used to help the reader quickly ascertain the paper's purpose._"


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