US tax policy, FATCA, FBAR criticized on a Swiss website: the embarrassment of the United States — English translation of the open letter

Here is a link to the English translation of the open letter in French, published several days ago on the Infrarouge public debate program’s site at Télévision Suisse Romande.

I would encourage anyone here who has the time to post responses on the TSR Infrarouge website in order to fuel the debate and increase awareness amoung the Swiss of how bad the situation is:

http://www.infrarouge.ch/ir/thread-364069-suisse-protege-assez-peuple-contre

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11 thoughts on “US tax policy, FATCA, FBAR criticized on a Swiss website: the embarrassment of the United States — English translation of the open letter

  1. @Jefferson, I think the “.. and pay taxes for 10 years” is incorrect. I think it changed in 2008. You don’t pay for 10 years now, but you pay an “exit tax” if you have over 2 million or more in US assets. Some say that it’s really lower, like $600,000 USD. The answers are on the internet.

  2. @geeeez, Jeff: I think theoretically that HEART Act (2008) superseded the Reed Amendment (1996) but did not invalidate or annul it. This gets us into a weird situation where bureaucrats decide what laws they will implement and enforce leaving the rest of us as victims of their unclear and capricious policies.

  3. @Petros,geeeez I think we can definitely expect unpredictable regulations and further bait-and-switch techniques as observed with VDP. ACA wrote a very keen paper on that: http://www.aca.ch/fbarscam.pdf

    My hope is that the Canadian government will stand its ground and we could subsequently use the Canadian experience to lobby other governements to do the same (not collect FBAR penalties, not collect taxes from persons for years where they were citizens of the host country).

  4. @Jefferson D. Tomas

    I have to find more info but my understanding is in the “UBS” case Switzerland refused to give any information to the US on US citizens living in Switzerland or in fact living anywhere outside of the US with one narrow exception no matter how much assets they had(The exception was US persons abroad who created sham companies to hide assets for them after they returned to the US). Now I don’t know what the rationale of Swiss government for demanding that view was or for the US accepting it but if you look closely at the agreement it specific refers to “US domicilied persons” which is technically anyone living in the US i.e Citizens, Green card holders, Resident Aliens but not US Persons living abroad. What is interesting as I understand it is everyone believes this original UBS agreement is the template for future cooperation with other Swiss banks with undeclared account problems.

  5. @Tim I believe that the UBS did not disclose anything with respect to “Onshore” Swiss accounts held by Swiss residents. But this would not preclude further “fishing expeditions”. A few months ago, the Swiss government agreed to respond to grouped requests for information (even if exact acountholder names were not known). http://www.tsr.ch/info/suisse/3394027-evasion-fiscale-pas-besoin-de-noms-pour-les-usa.html Sorry, you’ll have to Google the translation of that one, I am too lazy to do it.

    Personally, I would recommend to avoid using any of the “international” Swiss consumer banking services (banks like UBS and CS who have major activities and subsidiaries in the US).

  6. Jefferson lives!

    A great open letter, written almost as eloquently as America’s original Declaration of Independence.

    “Taxation without Representation” in the government’s lawmaking body, and with no tangible benefits in return, is an outright human rights abuse.

    The quiet disclosure of the persecution of America’s Diaspora is about to become noisy.

    Well done Jefferson!

    Hancock

  7. The interesting thing about the current US worldwide tax system is that it actually causes great economic harm to the United States.

    If they switched to residency based taxation like all other civilized countries they would reap huge benefits and instead of alientating expatriates would have them as allies. Imagine being proud to be an American instead of feeling like you have to run and hide because your former government wants to bankrupt you.

    Obama’s own Job Council recommended switching to a territorial tax system. The Republicans are already in agreement that this is the way to go if America wants to recover. Obama has these smart people from major corporations advising him but doesn’t seem to listen, although he’s paying a little more lip service to them lately. I still don’t think tax reform can happen under this President but here’s a link to a news article about the Job Council’s recommendations.

    Obama’s Job Council Recommends Tax Reform

    http://www.usa-tax-news.com/story/Obamas_Job_Council_Recommends_Tax_Reform____53544.html

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