#FATCA Chronicles in New Zealand

New Zealand is getting very hot on the FATCA front.

Now a fascinating article by Just Me. It includes:

As Tim has previously reported here, New Zealand’s National Government (pseudo Republican Conservative lite equivalent)  introduced Legislation to implement a FATCA IGA, the U.S. Democrat’s liberal ideological global agenda.

Strange bed-fellows and alliances are formed when the U.S. resorts to global extortion to impose its will!

The FATCA IGA round up of New Zealand continues in stealth like many other countries in the world.

This Bill has been met by resounding silence in the mainstream NZ media.  They, like the USA, seem to have NO interest in taxation matters that might bother their distracted entertainment or sport consumed audience. Besides, Kiwis are used to auto tax deductions and reporting. What is one more?

The only NZ publication where I have noted this FATCA IGA story, is in Interest.co.nz . That only got 4 comments. There was also one blog that Badger discovered.

The first reading of this Omnibus Tax bill, the sneaky way parliamentary governments get a lot of revenue matters past without much notice or debate, is today.

Kiwi Osgood, a contributor to many good discussions like here and here, as written an emailtoday to Labour Opposition Leader,  David Cunliffe addressing his concerns and questions about this shameful legislation being introduced by Revenue Minister Todd McClay:

Dear Mr Cunliffe

I have written to you previously on the subject of the US Foreign Account Tax Compliance Act (FATCA) and it’s effect on New Zealand and it’s Citizens. This one page summary provides a brief overview.

Shamefully, our government is negotiating an Intergovernmental Agreement (IGA) with the United States to implement this extraterritorial law in New Zealand, at great cost to the New Zealand taxpayer and even greater cost to those New Zealand Citizens unfortunate enough to have a US “connection” (Born there, has a US parent or is/was a Green Card holder). Similar to the TPP agreement, this is being done in secret, without parliamentary oversight. The only consultation that has occurred is with New Zealand financial institutions, who have their own agenda and have lobbied strongly for this IGA.

FATCA cannot be implemented in New Zealand without breaching New Zealand Privacy and Human Rights laws, with or without an IGA. The bill that is scheduled to have its first reading on Tuesday 3rd December is a tax omnibus bill (No. 176-1) titled “Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Bill“. Part 11B (Foreign account information-sharing agreements) contains the legislation that will force New Zealand financial institutions to comply with the (as yet unsigned) IGA with the United States.

The imposition of FATCA on New Zealand by the United States is a breach of New Zealand sovereignty and essentially turns the New Zealand IRD into an enforcement arm for the IRS. The harm to New Zealanders and the drain on the New Zealand Treasury will be measured in tens, if not hundreds of millions of dollars – for nothing in return other than the removal of the threat of sanctions against our financial institutions.

Some urgent questions need to be directed to Revenue Minister Todd McClay:

1.  Why is legislation that will breach New Zealand Sovereignty and override our Privacy and Human Rights Acts being buried in a tax omnibus bill? FATCA requires that New Zealand financial institutions “hunt down” New Zealanders of a specific national origin (US) in order to violate their privacy and turn their private financial data over to a foreign government. Spouses, New Zealand charities and any other organisation that the “US Person” has an account with signing authority will also have their data reported. Why is legislation being introduced that relies upon the signing of an agreement with a foreign government that has been “negotiated” in secret?

2.  Why is legislation that will breach New Zealand Sovereignty and override our Privacy and Human Rights Acts being buried in a tax omnibus bill? FATCA requires that New Zealand financial institutions “hunt down” New Zealanders of a specific national origin (US) in order to violate their privacy and turn their private financial data over to a foreign government. Spouses, New Zealand charities and any other organisation that the “US Person” has an account with signing authority will also have their data reported.Why is legislation being introduced that relies upon the signing of an agreement with a foreign government that has been “negotiated” in secret?

3.  How can legislation be contemplated when a cost/benefit analysis has not been done. The accompanying Regulatory Impact Statement (RIS) (point 18), states that “Inland Revenue does not consider it is possible to estimate the fiscal costs/benefits of entering into an IGA with the United States?”

4.  What consultation will be done concerning the contents of the proposed IGA? The RIS (point 25) states that “The content of any IGA agreed between officials of the United States and New Zealand will be subject to scrutiny in the appropriate manner”. What exactly does this mean? (Actually, we already know the content as it is offered by the United States on a “take it or leave it” basis – see point 25 of the Treasury “Budget 2013 Information Release”. Some negotiation.

5.  What will be done to protect New Zealand Citizens from seizure of their legal, post tax paid, New Zealand assets by the United States after their data has been reported? Will New Zealand collect on behalf of the United States causing an increasing drain on New Zealand GDP?

There are many other deeply disturbing implications and consequences of this misguided law. Please stand up for all New Zealanders and hold the government accountable for its actions by asking the above questions BEFORE an agreement with the United States is signed.

Yours Sincerely,

A proud New Zealander (with an unwanted US connection)

5 thoughts on “#FATCA Chronicles in New Zealand

  1. Osgood

    Thanks for blogging about this. Awareness is indeed being raised in parliament. Just an update, the bill is on a parliamentary schedule published yesterday, but will probably not be read until early next week. I will post updates on IBS. In addition to the above, the Attorney-General has been notified that this bill breaches the Bill of Rights and believe he has a duty to inform parliament of this.

    New Zealand is an interesting test case, as I think they are the first country to attempt to put legislation through the Parliament before the IGA has even been signed. Not sure of their motives for that, but we will see how it pans out.

    Reply
  2. Pingback: Further submission to the New Zealand budget committee on #FATCA and the Exit Tax | Citizenship Counselling For U.S. Citizens in Canada and Abroad

  3. Pingback: New Zealand surrenders to US Treasury – It’s a #FATCA | Citizenship Counselling For U.S. Citizens in Canada and Abroad

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