Opinion
A woman walks out of the Internal Revenue Service building in New York in this May 13, 2013 photo. REUTERS/Shannon Stapleton(UNITED STATES - Tags: BUSINESS POLITICS) A woman walks out of the Internal Revenue Service building in New York in this May 13, 2013 photo. REUTERS/Shannon Stapleton(UNITED STATES - Tags: BUSINESS POLITICS)  

Canada capitulates to FATCA and the IRS

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Theo Caldwell
Investor and Broadcaster
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      Theo Caldwell

      Theo Caldwell, an international investor and broadcaster, has been a member of the New York Stock Exchange, the Chicago Board Options Exchange, the American Stock Exchange, and the Kansas City Board of Trade.

As of this past week, the Canada Revenue Agency works for the Internal Revenue Service. The subordination of Canada’s tax authority to its American counterpart came in the form of a euphemistically named “Intergovernmental Agreement” pursuant to the U.S. Foreign Accounts Tax Compliance Act (FATCA).

The result is that starting Canada Day (July 1), Canadian banks and other financial institutions will be required to comb through client accounts containing $50,000 or more to determine if they are “U.S. Reportable.” They must then inform CRA, which will pass the information along to the United States.

Notwithstanding that Canada’s leaders have subjected their citizens to the most rapacious and malevolent tax department in the world in the form of the IRS, they have committed a craven surrender of national sovereignty.

FATCA, passed by the US Congress in 2010, is an extension of America’s anomalous and larcenous practice of demanding taxes from people, regardless of where they reside in the world.  The United States is one of only two countries that engage in this disgraceful conduct (Eritrea being the other).

Let us eliminate a deliberate misconception: This agreement is not about catching “tax cheats” as its proponents aver and journalists obediently repeat.

It is about expanding America’s oversight of global commerce, while increasing its ability to confiscate funds to which it has no legitimate claim.

Indeed, the only apparent cheating is that of the United States, which assumes the power to demand taxes from people who do not live in that country, do not use any of its public services, and in many cases have never been there.

This is international theft, effected by the threat of fines, prosecution and imprisonment.

Most people, including Americans, are unaware of the United States’ criminal practice of worldwide taxation. Consequently, when breast-beating yahoos proclaim “America, love it or leave it,” they evince ignorance that, as a practical and financial matter, leaving is not an option.

Renouncing U.S. citizenship is no clear solution (although record numbers have done so in recent months), since the American government broadly defines its tax subjects as “U.S. Persons.” This may include people who have studied or worked in the United States, or who have never set foot on American soil yet have family or business associates with roots there.

Why, then, would Canada acquiesce to such an absurd arrangement?

Some might suggest the deal was struck as a political quid pro quo, to convince President Barack Obama to approve the stalled Keystone XL oil pipeline from Alberta to Texas. But the prevailing politics of the president’s hesitation have always been domestic, rather than international.

After years of studies and reports, Keystone is the most analyzed conveyance in the history of running liquid, and its delay persists to appease the environmental left of Obama’s Democratic base, not to force Canada to sell out its own people to the IRS.