Finance Committee on May 14th, 2014

[Chantal Bernier]

Absolutely. So the obligation of consistent use remains, the obligation to only collect what is necessary remains, and, of course, the obligation to protect the information remains. The reason we are putting to your attention the risk of over-collection and over-reporting is our experience with FINTRAC. With the PCMLTFA, we find that there's a built-in incentive to over-report. We would want to make sure that this doesn't occur here.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Understood.

We've heard a number of witnesses, even those who are in favour of this initiative, say that this is more of a data grab than it is a tax grab. Canada is not a tax haven. This is not about the U.S. trying to collect that money. This is much more about data.

My last question is to Mr. Richardson or anyone who wishes to answer.

What kind of information can be gleaned about a person—Mr. Hannah, maybe you can come in on this—by their tax information? If I could see your tax information, what could I learn about you?

[The Chair, Conservative, James Rajotte]

Just one person, very briefly, please.

[John Richardson]

If I may, I will answer that question. Currently, the Internal Revenue Service has a program called “Streamlined”, to allow non-compliant U.S. citizens to come into compliance. What they are requiring as part of that is six years of foreign bank account reports, known as FBARs, sent directly to the IRS.

Now normally, these are sent to the U.S. Treasury, and the IRS wouldn't see them. The reason the IRS wants them is that they are absolutely the best indicator they have about a person's financial status and whether they meet the test of what the IRS would call “low compliance risk”. There's absolutely no question that this information tells one far more about somebody's finances than anything else.

[The Chair, Conservative, James Rajotte]

Thank you.

Thank you, Mr. Cullen.

Mr. Van Kesteren, please.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Thank you, Chair.

Thanks to all of you for being here.

Mr. Richardson, you're a dual citizen?

[John Richardson]

I am.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

How long have you been a Canadian citizen?

[John Richardson]

How long have I been a Canadian citizen? I became a Canadian citizen in I think 1990 or 1991.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Okay.

Please don't misinterpret me. I'm not trying to be aggressive in this. I just want to understand something.

Do you value your American citizenship?

[John Richardson]

Do I value my American citizenship?

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Let me rephrase that. Would you like to be one of these that would just like to revoke it or do you want to...?

[John Richardson]

I haven't made that decision yet. Certainly the longer one lives outside of the United States.... I've lived outside the United States since I was 12, so I consider myself 98% Canadian, with maybe 1% or 2% to go over the next few years.

[Voices]

Oh, oh!

[John Richardson]

I can tell you that I don't think the question is so much does one value a U.S. citizenship...I think the question is, does one value it in a way that could possibly be worth the cost of it and the problems that are now arising?

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

I guess what I'm trying to mine down to, and it's perfectly understandable... I checked your site, too, The Isaac Brock Society—

[John Richardson]

That's not my site. I'm at citizenshipsolutions.ca.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Okay.

What, are you like a kind of modern-day Loyalists that break away from the States or...? This organization, would you classify it as one that's helping American citizens break away from the—

[John Richardson]

Sorry, which organization are you talking about?

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

The Isaac Brock: you're not part of that?

[John Richardson]

I am at citizenshipsolutions.ca.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Okay.

[John Richardson]

I am a lawyer who helps American citizens deal with citizenship.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Okay.

How many of those Americans would you say, percentage-wise, would like to revoke their citizenship? Or how many are just concerned about the tax implications?

[John Richardson]

Obviously, the ones I talk to, because they call me in a professional capacity, clearly are unhappy with the problems of U.S. citizenship—and the word would be “relinquish”—and want to relinquish it. Certainly, I think it's more a question of education. When people learn about this, they become concerned. The more they learn, the worse it gets.

The conclusion is that, because of the incompatibility, not so much in the taxes.... This isn't so much a tax situation. The U.S., under the guise of what they call citizenship-based taxation, actually has this set up more as a form of life control. There is no way to be both U.S. tax compliant and do any kind of reasonable financial retirement planning in Canada.