#Americansabroad: Thoughts on the May 2/14 Toronto Conference on CBT vs. RBT – #FATCA #FBAR

The May 2, 2014 Toronto Conference on U.S. citizenship-based taxation was a great success. As the ACA Global announcement of results describes the morning and afternoon had separate themes and participants.

Morning Session: The morning session featured a debate between Professor Michael Kirsch of Notre Dame law school and Dr. Bernard Schneider of Queen Mary in London, U.K. As was expected, Professor  Kirsch defended U.S. citizenship-based taxation and Dr. Schneider opposed it. The debate was moderated and both speakers responded to questions from the audience. The morning was about  the “pros and cons” of the theory of taxation.

Afternoon Session: This demonstrated what U.S. citizenship-based taxation means in practice and how it actually effects people. The four afternoon speakers included:

Phil Hodgen – The numerous legal requirements imposed on Americans abroad

David Kuenzi – Investment options for Americans abroad that meet U.S. restrictions

Charles Cullen – Investment options for Americans abroad that meet U.S. restrictions

Jim Yager – A demonstration of tax requirements, penalties and compliance options.

My personal thoughts:

The day was an incredible experience. To have this group of participants in one room, for one day, talking with each other, about this important issue was an “eye opener”. As I listened to the speakers it became clear to me that the issue of “citizenship-based taxation” is much more about “citizenship” than about taxation.

The question is NOT so much: Is citizenship-based taxation justified?

The question is rather: what is it about citizenship that would justify  taxation?

There is a difference between those who are “technically citizens” and those citizens who have a degree of engagement with the United States that could justify taxation.

There are two points that were illuminated by the Toronto Conference:

1. What the U.S. calls “citizenship-based taxation” is really taxation based on “place of birth”. To suggest that because someone was born in the U.S. means that they have to pay taxes to the U.S. regardless of how their life unfolds is ridiculous.

2. Even if “citizenship-based taxation” is justifiable, the current U.S. system to taxation and reporting goes too far and cannot be justified.

And finally, a special thanks to  …

Jackie Bugnion of ACA, Marylouise Serrato of ACA Global and Dr. Stephen Kish for his role as academic host of the Conference.

 

 

Pictures:

Dr. Schneider (left) and Professor Kirsch (right)

Dr. Schneider (left) and Professor Kirsch (right)

Charles Cullen, Bernard Schneider, David Kuenzi, Jim Yager, Jackie Bugnion (left to right)

Charles Cullen, Bernard Schneider, David Kuenzi, Jim Yager, Jackie Bugnion (left to right)

Lunch discussion with the speakers

Lunch discussion with the speakers