Cook v. Tait 44: “Sovereignty”, “Citizenship” and use of “citizenship” to further the interests of the “sovereign” – The evolution from #CookvTait to #FATCA

As citizenship evolves …

I began this post in 2015. It has languished in draft form since that time. It is now November of 2017. As #TaxReform17 comes to an end, I feel motivated to finish it. It is now 2019. Really, it’s probably now or never. This post draws heavily from posts, insights and comments from a number of bloggers and (past) contributors to the Isaac Brock Society. Your comments have helped to shape this discussion. This post will continue my Cook v. Tait Book (a collection of posts written about U.S. citizenship based taxation taxation-based citizenship, which started in 2011. (Much of the Cook v. Tait book appears as a resource at the Isaac Brock Society – a rich source of comments about life in an FBAR and FATCA world.

About citizenship: One way or the other, citizenship matters ..

The purpose of this post is to explore various aspects of the concept of citizenship through the 20th century and the first part of the 21st century. This is an interesting topic in it’s own right. It is particularly important in the context of Cook v. Tait. As the likelihood of a lawsuit against “citizenship-based taxation” increases, the importance of understanding “the evolution of citizenship” increases. I propose to consider this issue under the following “Part”s:

Part A –  Citizenship under international law – An aspect of the Sovereignty of Nations

Part B – Citizenship, international law and citizenship evolution triggered by “war”

Part C – Evolution of citizenship under U.S. “domestic law” – 1967 – Afroyim – The U.S. Supreme Court and the “constitutionalism” of U.S. citizenship

Part D – Notions of Citizenship in the 21st Century

Part E – The forced imposition of U.S. citizenship

Part F – Citizenship as a weapon – The role of “citizenship taxation” in the “weaponization of finance”

Part G – Citizenship-based taxation as a way of controlling the life choices of Americans abroad

Part H – Citizenship-based taxation as a mechanism to export U.S. cultural values to the rest of the world

Part I – Dual citizenship in a world of U.S. extra-territorial laws

Part J – Citizenship-based taxation as a way to export U.S. cultural values to the Muslim world

Part K – Multiple citizenships and public office: Australia’s “Citizenship Seven”

Appendix – Modern thinking and research on the rights and obligations of citizenship


Part A –  Citizenship under international law – An aspect of the Sovereignty of Nations

In Cook v. Tait 23, I noted that Cook v. Tait was decided approximately 100 years ago and that the concept of citizenship was different from what it is today. “Cook v. Tait 23” referenced a post at “” that discussed the evolution of citizenship. The purpose of this post is to explore how, the concept of citizenship has evolved since 1924.  What were the fundamental assumptions of citizenship in 1924? How have those  assumptions changed over  the years? When Justice McKenna was writing his decision in Cook v. Tait, what exactly did he believe “citizenship” to be? For that matter, what does the judgment in Cook v. Tait even mean? Was Justice McKenna’s decision in Cook v. Tait based on “reason”? If it was based on “reason”, was it based on “legal reasoning”? Was it based on “rhetoric”? The decision of any judge necessarily reflects his or her personal background, outlook on the world and built in biases.

About Justice McKenna …

Assuming the truth of this Wikipedia entry, Justice McKenna was:

an American politician who served in all three branches of the U.S. federal government, as a member of the U.S. House of Representatives, as U.S. Attorney General and as an Associate Justice of the Supreme Court. He is one of seventeen members of the House of Representatives who subsequently served on the Supreme Court (including two Chief Justices).

It appears that Justice McKenna was a man devoted to “public service” and that (in general) he served the public with great distinction. It appears that his appointment to the Supreme Court of the United States was a pure political appointment (one of many). To his credit, after having been appointed to the Supreme Court, he being:

Conscious of his limited credentials, McKenna took courses at Columbia Law School for several months to improve his legal education before taking his seat on the Court.

Justice McKenna wrote the decision in Cook v. Tait in 1924. The decision was subsequently used to subject millions of people living outside the United States to U.S. tax jurisdiction. It appears to be a decision that is premised more on rhetoric than on reason. Soon after Cook v. Tait:

McKenna resigned from the Court in January 1925 at the suggestion of Chief Justice William Howard Taft.[9] McKenna’s ability to perform his duties had been diminished significantly by a stroke suffered 10 years earlier, and by the end of his tenure McKenna could not be counted on to write coherent opinions.

Cook v. Tait – Interpreting the decision – citizenship as an aspect of sovereignty

In Cook v. Tait 26, commenters at the Isaac Brock Society generously helped interpret Justice McKenna’s 1924 decision. The comments were enormously helpful. Some of the comments discussed  the sovereignty of the United States and how the ability to define the responsibilities of citizenship was an incident of that sovereignty, under the principles of international law. A U.S. lawyer (commenting on Facebook) recently opined that:

… don’t hold your breath waiting for a civil war to break out and end taxation of US citizens and residents. Cook v Tait is based on traditional notions of sovereignty, not on an assessment of the value conferred by citizenship. The Court specifically rejected the argument that expats received no benefits from the US and so shouldn’t have to pay taxes. Sovereignty remains a core principle, if not the core principle, of international law.

Consider also the following comment by Shadowraider:

I’m late to the discussion, but here is my opinion.

The decision in Cook v. Tait was purely based on principles of international law, it had nothing to do with the US constitution. International law is mostly unwritten, based on the general customs of relations between countries, and also on written treaties. So to decide this case, one would have to see whether jurisdiction based on nationality in the area of taxation is something generally accepted among countries, in their declarations, actions and treaties. As much as I don’t like it, I have to admit that it is, and this has not changed since 1924. It’s certainly rare, but the numerous examples lead me to conclude that it is indeed an accepted practice: others countries used it in the past (Mexico, Philippines, Soviet Union, Bulgaria, Vietnam, Myanmar), some still use it today in rare circumstances (France, Spain, Italy, Finland, Hungary, Turkey), and it is the last tie-breaker to determine residence in hundreds of tax treaties. The condemnation of Eritrea is due to the alleged illegal or oppressive enforcement of its diaspora tax, not the tax itself. The Philippines had a very similar tax for decades (1-3%) and was never condemned for it, as far as I know. The EU prohibits tax discrimination based on nationality, but France recently considered the possibility of taxing its citizens living in Andorra, as it already does in Monaco (both outside the EU). Finally, dozens of countries accepted the saving clause in US tax treaties, and more recently the FATCA IGAs.

I don’t think that Justice McKenna was saying that taxation is justified because the country provides tangible benefits to the citizen. I think that he was simply using the word “benefits” to refer to the abstract connection between a country and a person, called citizenship, and that this connection by itself carries obligations such as taxes. In other words, jurisdiction by nationality, which is accepted in international law.

On the other hand, I emphasize that Cook v. Tait did not refer to the US constitution at all. I also agree that in 1924 the general understanding of the US constitution did not pose a problem for CBT. However, this did change since then. For example, the US Supreme Court gave new meanings to “due process” and “equal protection” to prohibit discrimination on various grounds (1954), and the 24th amendment prohibits the dependence of voting rights on taxation (1964). I believe that CBT is unconstitutional with these understandings, because it is discrimination based on citizenship on an area that has nothing to do with citizenship. In this case, Cook v. Tait is not a precedence.

To answer some of your questions:

1. It’s debatable whether the constitution allows CBT, but it’s certainly not required by the constitution. Again, Cook v. Tait was not based on the constitution at all.
2. Cook had property in Mexico, I suppose real estate, and he rented it out. The US taxes rental income.
3. Mexico created its first income tax in 1921, so there could have been double taxation. Coincidentally, Mexico also had CBT until 1980.
4. “Do you know of ANY country which gave up a source of income voluntarily?” Mexico, the Philippines, the Soviet Union, Bulgaria, Vietnam and Myanmar abolished CBT. Australia, New Zealand, Canada, Mexico, Panama, Israel, India, Pakistan, Thailand, Singapore, Hong Kong, Russia, Austria, Portugal, Sweden and Norway abolished their inheritance tax. Sweden also abolished its wealth tax. Australia, Argentina and Brazil abolished a bank transaction tax. Most US states abolished their estate tax, and the federal government abolished it for a year. The US also abolished the limitation on the foreign tax credit for the alternative minimum tax.

To summarize …

The key point is that the concept of citizenship was largely “rooted in” the “sovereignty of nations”.  Note that this is a concept of citizenship that is defined in terms of how the state relates to it’s citizens. There is agreement that “citizenship” involves both rights and responsibilities. It appears that in 1924, citizenship was defined more in terms of “responsibilities” and less in terms of “rights”.

Part B – Citizenship, international law and citizenship evolution triggered by “war”

To the extent that the law of  citizenship, is a function of international law, it’s clear that international law has evolved.

1. World War I comes to an end – The League of Nations begins – Clarifying the rights of countries over citizens

About the League of Nations …

The League of Nations was created at the end of World War I. The purpose was for nations to work together to avoid war. The League of Nations was supported by U.S. President Wilson, but was not agreed to by the U.S. Senate. Hence, the United States (although a participant in its creation) was NOT a member of the League of Nations. Canada’s role was described as follows:

Canada was a founding member of the League of Nations — an organization of countries established in 1919 at the end of the First World War. The League failed in its main purpose of keeping peace through the arbitration of international disputes. It was replaced by the United Nations at the end of the Second World War.

Treaty of Versailles

The 1919 Paris Peace Conference, at the end of the First World War, produced the Treaty of Versailles. The main authors of the Treaty — Britain (and its Dominions, including Canada), France and the United States — wanted to establish an international organization of member states founded on the principles of collective security, and the preservation of peace. The Treaty included a provision, or “Covenant,” for the creation of a League of Nations.

American President Woodrow Wilson had played an important part in founding the League, but the United States Senate refused to ratify the Covenant of the League — partly because of American partisan politics. As a result, the U.S. never joined the League, which deprived it of significant power and authority.

However, 63 other states were members. The League established headquarters in Geneva, Switzerland. It included a council, assembly and secretariat. The council met quarterly and comprised the major powers as permanent members, plus non-permanent members elected by the assembly. The assembly consisted of representatives of all member states, and met annually. Under a secretary-general, the secretariat provided the permanent staff.

Given that the League of Nations evolved from the Treaty of Versailles, it’s clear that the League of Nations was NOT concerned as much with the rights of individuals as with the interaction among countries.

The League of Nations and Nationality Law

In the late 1920s, the League of Nations began a project which resulted in a informal treaty governing “nationality law”. The primary focus and purpose of the treaty was to clarify the rights that nations had over citizens and in what way(s) one country would recognize/respect the rights of nations over their citizens.

To put it another way:

The 1930 Hague Treaty was an instrument that did NOT clarify the rights of citizenship, but rather clarified the rights of nations in relation to its citizens. Clearly, in 1930, the “citizens of the nation” were considered to be the “property of the nation” – a view that has been diminished  today. Cook v. Tait was decided in an era where, the issues were less about the “rights of the citizen” and more the “rights of the country in relation to its citizens”.

The following discussion paper, which originated at Harvard University, and was submitted to the League of Nations is fascinating. It canvasses most of what was known about “citizenship law” at the time. It’s a must read for those interested in the evolution of the law of citizenship.


The key point to remember is that the “Hague Convention” was concerned with the rights of nations over their citizens and NOT with the rights of citizen in relation to nations.

Citizenship: Who decides? – What is the League of Nations nationality law?

In January of 2013, Victoria Ferauge wrote an excellent post called “Citizenship: Who Decides“. It is (as are her posts) an excellent discussion of an important issue. As the title implies, she raises the question of:

To what extent can a country simply claim us to be citizens?

This is a question of current concern. The U.S. government, by unleashing “FATCA Hunt” on an unsuspecting world, has caused individuals to fear that they may be considered to be U.S. citizens.

Victoria’s post is based largely on an analysis of the 1930 “Hague Convention of Certain Questions Related to the Conflict of Nationality Law“. (The “law of citizenship” has evolved significantly since 1930.)

Victoria Ferauge asks the question:

Does the individual have the right of refusal when it comes to citizenship?

Victoria referring to the Hague Convention writes:

The citizenship laws of nation-states are for the most part a purely domestic matter.  The Hague Convention on Certain Questions Relating to the Conflict of Nationality Law says very clearly:

Article 1.

It is for each State to determine under its own law who are its nationals. This law shall be recognised by other States in so far as it is consistent with international conventions, international custom, and the principles of law generally recognised with regard to nationality.

Article 2.

Any question as to whether a person possesses the nationality of a particular State shall be determined in accordance with the law of the State.

Article 3.
Subject to the provisions of the present Convention, person having two or more nationalities may be regarded as its national by each of the States whose nationality he possesses.

So the short answer to the question, “Does the individual have the right of refusal when it comes to citizenship?” is a clear “no.”  If the French decide you are French under the French citizenship laws then that’s the way it is.  A person can, of course, renounce but citizenship/nationality is clearly a status that the individual has no control over (unless of course he or she obtains it through naturalization).

Are there any limits to the ability of a state to ascribe nationality/citizenship to an individual?*

Now this is where it gets interesting.  As a practical matter it is clear that there are limits.  The United States of America cannot simply decide to turn the entire French nation into American citizens with the stroke of a pen.  I’m not sure what principle this would defy but it seems that it might fall under one of the exceptions in Article 1 above that calls for consistency with international conventions and customs.

One very interesting article I found on-line talks about (and criticizes) something called the “genuine link” doctrine that was used (and perhaps still is) to limit the right of a state to ascribe nationality/citizenship to an individual.  It says that there must be some sort of legitimate attachment in existence before a state can claim someone as “theirs.”  And this link is?    “A legal bond having as its basis a social fact of attachment, a genuine connection of existence, interests and sentiments, together with the existence of reciprocal rights and duties.”  In my mind this raised more questions than it answered.  Going back to the Frenchwoman I talked about above, the legal bond exists but there is no real attachment behind it.  Or is there?  Is the mere fact that she was born on U.S. soil sufficient in the eyes of the United States to create a permanent and abiding attachment?  Given that she was aware of her rights, is it unreasonable to say that she should also be aware of her duties even if the connection is inactive?  To put it another way, should she be held to the obligations of that yet to be actualized citizenship and pay, for example, U.S. taxes?  Or, for another example, could she called upon to defend the U.S. and her Constitution if these things were under attack?  Could she be considered a traitor if she didn’t?

What I gathered as I read is that international law around citizenship is practically non-existent.  Nothing is explicit. The only thing that states seem to be able to agree upon is that jus soli and jus sanguinis are the two customary methods by which citizenship is transmitted and that’s about it.   If you have information to the contrary I would be most interested in knowing it.

Can states enforce their sovereignty over its nationals wherever they may be?

Final question and the answer is ‘yes” and they do it all the time if they are sufficiently motivated and an opportunity presents itself.  States may not be able to immediately force compliance in some cases if the individual is living in another country but they can and do (if they are so motivated) go after that person or detain him at the border if he or she tries to enter the other country to visit family or just to visit.

The excellent Dual Nationality FAQ has these cautions to offer naturalized and “Accidental” citizens who enter another country of nationality.  The example here uses the example of U.S. birthright or naturalized citizens but what he says is equally true of other countries as well.

“So, even after becoming a naturalized US citizen, you should still check carefully with diplomatic officials both of the US and of the “old country” before going back for a visit. If you get arrested there for draft evasion, for voicing opinions about their government while you were in the US which are considered taboo in the old country, or for whatever other reason — or if you find yourself forced into their armed forces — you may very well find that the US can’t help you too much, because the other country will insist you’re one of their own citizens and that the matter is therefore none of the US’s $@&%# business.This same word of caution may also apply to people who were born in the US, but whose parents (or even grandparents) came from somewhere else. Many countries have laws conferring citizenship on the basis of the citizenship of one’s parents or grandparents (even the US has a limited law of this kind). I personally knew someone, some years ago, who got into trouble in South Korea because his father was born in Korea. Even though my friend was born in the US and had never claimed or believed himself to be a Korean citizen, he had to cut short his visit to his ancestral homeland in order to avoid being drafted into the South Korean army.”

So there you have it.  Rather chilling isn’t it?  I will stop there and get ready to take my train into Paris.As always your comments would be most welcome.

2. World War II comes to end – The United Nations Begins – The ascendancy of the rights of individuals

At the end of Word War II, the League of Nations came to an end and the United Nations was born. Along with the birth of the United Nations, came new human rights instruments that focused on the rights of individuals.

1. The United Nations Declaration of Human Rights


Whereas recognition of the inherent dignity and of the equal and inalienable rights of all members of the human family is the foundation of freedom, justice and peace in the world,

Whereas disregard and contempt for human rights have resulted in barbarous acts which have outraged the conscience of mankind, and the advent of a world in which human beings shall enjoy freedom of speech and belief and freedom from fear and want has been proclaimed as the highest aspiration of the common people,

Whereas it is essential, if man is not to be compelled to have recourse, as a last resort, to rebellion against tyranny and oppression, that human rights should be protected by the rule of law,

Whereas it is essential to promote the development of friendly relations between nations,

Whereas the peoples of the United Nations have in the Charter reaffirmed their faith in fundamental human rights, in the dignity and worth of the human person and in the equal rights of men and women and have determined to promote social progress and better standards of life in larger freedom,

Whereas Member States have pledged themselves to achieve, in co-operation with the United Nations, the promotion of universal respect for and observance of human rights and fundamental freedoms,

Whereas a common understanding of these rights and freedoms is of the greatest importance for the full realization of this pledge,

In August of 2012, an interesting  post  appeared at the Isaac Brock Society which both identified the sections of the Declaration and measured U.S. conduct against those standards.

Articles 4, 13 and 15 were singled  out for  special  commentary as follows:

Article 4.

  • No one shall be held in slavery or servitude; slavery and the slave trade shall be prohibited in all their forms.

To deny a person the right to expatriate by applying to them punitive treatment such as banishment or exit taxes is to make them a slave of the state.  A slave has no right to move where he wants or to take the nationality of any country he chooses.  The Ex Patriot Act treats people as slaves and not as free people.

Article 13.

  • (1) Everyone has the right to freedom of movement and residence within the borders of each state.
  • (2) Everyone has the right to leave any country, including his own, and to return to his country.

An expatriate who renounces citizenship nevertheless has a right to return under Article 13; this right of return does not obviously still include taking up residence or employment without obtaining the appropriate visa, but it is a right that must be extended to the expatriate to the same degree as to any other citizen of the expatriate’s new country.  A Canadian citizen may stay, for example, for six months in the United States without a visa.  To forbid a former citizen who is now a Canadian citizen the same length of stay in the United States is a violation of Article 13, which attempts to prevent tyrannical countries from permanently exiling people born in their land.

Article 15.

  • (1) Everyone has the right to a nationality.
  • (2) No one shall be arbitrarily deprived of his nationality nor denied the right to change his nationality.

Article 15 treats the right to expatriate as a fundamental right.  The Ex Patriot Act seeks to prevent rich citizens from exercising this fundamental right.

2. The International Covenant on Economic Social and Cultural Rights “ICESCR”

3. The International Covenant on Civil and Political Rights “ICCPR”

Part C – Evolution of citizenship under U.S. “domestic law” – 1967 – Afroyim – The U.S. Supreme Court and the “constitutionalism” of U.S. citizenship

The 14th amendment of the U.S. constitution includes:

All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside.

In 1967 the U.S. Supreme Court issued it’s landmark decision in the case of Afroyim v. Rusk. The court ruled that, for those born as U.S. citizens or naturalized as U.S. citizens, that:

– U.S. citizenship belonged to the individual; and

– the U.S. government could  not “strip” such of  a person of U.S.  citizenship  without the consent of that individual.

Justice Black’s judgment in Afroyim concluded with:

Citizenship is no light trifle 268*268 to be jeopardized any moment Congress decides to do so under the name of one of its general or implied grants of power. In some instances, loss of citizenship can mean that a man is left without the protection of citizenship in any country in the world—as a man without a country. Citizenship in this Nation is a part of a co-operative affair. Its citizenry is the country and the country is its citizenry. The very nature of our free government makes it completely incongruous to have a rule of law under which a group of citizens temporarily in office can deprive another group of citizens of their citizenship. We hold that the Fourteenth Amendment was designed to, and does, protect every citizen of this Nation against a congressional forcible destruction of his citizenship, whatever his creed, color, or race. Our holding does no more than to give to this citizen that which is his own, a constitutional right to remain a citizen in a free country unless he voluntarily relinquishes that citizenship.

The United States  constitution includes a “constitutional guarantee” of citizenship. The  government cannot “strip” a “14th amendment citizen” of  citizenship without his consent. Renunciations of U.S. citizenship are rising. Today, the evidence strongly suggests that many Americans abroad feel that they are being forced to renounce their  citizenship. This may constitute the “constructive stripping” a person of his citizenship.

Part D – Notions of Citizenship in the 21st Century

As a reminder S. 15 of the U.N.  Declaration of Human Rights says:

Article 15.

  • (1) Everyone has the right to a nationality.
  • (2) No one shall be arbitrarily deprived of his nationality nor denied the right to change his nationality.

Are governments around the world respecting the “citizenship” guarantees found in Article 15? Let’s consider:

The “State of Article 15” in 2015

2015 – Statelessness: the consequences of NOT having a citizenship – Burma’s Rohingya

As horrible as the problems of Americans abroad are, nothing compares with plight of the Rohingya. For those who prefer having no citizenship to U.S. citizenship, this is  a warning:

This shocking article from CBC includes:

In Burma, Rohingya Muslims are not considered citizens. The country’s 1982 Citizenship Act does not recognize them as one of the country’s national races.

To acquire citizenship, Rohingya can attempt to prove their ancestors settled in Burma before 1823, but only a handful have been successful thanks to “the onerous burden of proof” required, according to Human Rights Watch.

Rohingya Muslims

Adulamin, 22, lives at a refugee camp in Burma after being released from a human trafficking ship. Many Rohingya Muslims have returned to their IDP camps after spending months on migrant boats that did not make it to Malaysia. (Soe Zeya Tun/Reuters)

As an essentially stateless people, this minority community is prohibited from attending public high schools. They can’t work for the government or be voted into public office. The government restricts their movement within Rakhine state and beyond its borders.

Rohingya Muslims are often forced into unpaid labour to help government-run projects, like breaking stones to build roads. Human Rights Watch reports some children have been forced into free labour as early as seven.

It has also been alleged that some Burmese military officials coerce Rohingya Muslims to hand over goods or animals, sometimes as a bribe to secure a travel permit.

2015 – Britain, Canada and the Dominican Republic – Stripping citizens of their citizenship

The Dominican Republic: The example  of the Dominican Republic underscores the reason for the 14th amendment of the U.S. constitution.

At issue is a ruling by the Constitutional Court in the Dominican Republic to strip away the citizenship of several generations of Dominicans.

According to the decision, Dominicans born after 1929 to parents who are not of Dominican ancestry are to have their citizenship revoked. The ruling affects an estimated 250,000 Dominican people of Haitian descent, including many who have had no personal connection with Haiti for several generations.

What we are witnessing is one of the largest humanitarian crisis in the western hemisphere, except this one is completely by choice.

Canada – Bill C-24

As a result of this new law, dual citizens and people who have immigrated to Canada can have their citizenship taken away while other Canadians cannot. The government’s press release last week tried to justify this discriminatory law by raising the threat of “jihadi terrorism,” but Bill C-24 could easily be used against non-terrorists—for example, a journalist who is convicted of a “terrorism offence” in another country for reporting on human rights violations by the government

The U.K.

LONDON — Britain has passed legislation that allows the government to strip terrorism suspects of their citizenship even if it renders them stateless, taking the country’s already sweeping powers to revoke nationality a step further.

After four months of wrangling, the House of Lords, the Parliament’s upper chamber, approved on Monday a clause in a new immigration bill that removes a previous restriction on leaving individuals without citizenship. The bill became law on Wednesday, after receiving royal assent.

Britain has been one of the few Western countries that can revoke citizenship and its associated rights from dual citizens, even native-born Britons, if they are suspected or convicted of acts of terrorism or disloyalty. The government has stepped up its use of this tactic in recent years. In two cases, suspects have subsequently been killed in American drone strikes.




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