I have yet to write to my MP, but I thought I would drop a line regarding FATCA to Liberty (one of the main civil liberties group in the UK) after reading this post at Isaac Brock Society and this post at Maple Sandbox. Here’s what I wrote [please forgive the typos, it was done in one of those little online submission boxes, awfully hard to proofread in it!]:
I was just wondering if you were aware of the recent IGA signed by the UK and the US, committing HMRC to provide the banking details for US persons in the UK to the US govt under the US’s draconian FATCA law tax law. What will happen is that UK banks will collect the data and hand it over to HMRC, HMRC will hand it over to the US. The IGA effectively waives data protection for anyone in the UK, absolving the banks of their data protection obligations, who is defined as a US person.
A US person is not defined only as a US citizen, but anyone connected financially to the US at some point, whether it is a British spouse or a business partner, or a British citizen with dual citizenship. In order for UK Banks to be compliant with FATCA, they will, by definition, have to discriminate against “US Persons” in some way or another, whether it is in the treatment of personal data, higher fees for banking, or choosing not to do business with US persons at all.
In Switzerland, already, rather than choose to implement costly compliance regimes, Swiss banks are now refusing to do business with US persons, cancelling mortgages and current accounts for people with dual citizenship; I suspect the same will happen here, or at least other discriminatory practices against people defined as US persons. (The US Ambassador to Switzerland even advised Americans to renounce their citizenship if they were planning on staying in Switzerland!)
In Canada, the Canadian Civil Liberties Association has weighed in with an open letter to the Ministry of Finance there, regarding FATCA.
(See here: http://maplesandbox.ca/wp-content/uploads/2012/12/CCLA-Letter-2-Finance1.pdf )
There is a lot of information on FATCA on the web, but a good starting point would be the Isaac Brock Society ( http://isaacbrocksociety.ca/ ), with many Canadian “US Persons” sharing their experiences. I’m not sure how aware US Persons in the UK are of what is about to happen; part of the conditions put upon UK banks with regard to being considered compliant was that they were not allowed to “tip off” their customers ahead of FATCA implementation. If considered non-compliant, the US will impose 30% withholding tax on all money going through the US accounts of British banks.
It is easy to dismiss this as a domestic US issue, but the implications for British citizens could be massive. The Government has agreed in principle to lift the data protection rights of British citizens; this is effectively lifting British sovereignty in favour US global taxation.
A Gentleman’s Rapier