Canadian government faces constitutional challenge over FATCA deal

Important step forward in preventing the IRS Commissioner replacing the Governor General as Canada’s head of state.
Although the FATCA IGA is an initiative of the Harper Government, there are other reasons why it is unconstitutional.

Financial Post | Business

Two women are suing the Canadian government over a controversial deal in which Canada has agreed to share the tax information of U.S. persons resident in Canada with the IRS.

Gwen Deegan, a graphic designer from Toronto, and Ginny Hillis, a retired lawyer from Windsor, filed a statement of claim in the Federal Court of Canada that accuses the Canadian government of overstepping its constitutional powers by agreeing to comply with a new U.S. law called the Foreign Account Tax Compliance Act (FATCA).

Under the Canada-U.S. agreement, which was reached in February and which took effect on July 1, the Canada Revenue Agency is to provide tax information to the U.S. Internal Revenue Service about the estimated one million Americans and dual U.S.-Canadian citizens who reside in Canada. Canadian financial institutions are required to search their records for accounts held by clients who meet the definition of “U.S. person” under…

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