Category: Parliament

Time to ask a good question

Thanks to a follower of this site who has urged their MP to submit Questions in Writing about the Australia/US Tax Treaty and the impact of FATCA on Australian residents claimed by the US as “US Persons.” As I’ve written elsewhere, allowing the US to tax the Australian-source income of Australian residents drains money from the Australian economy. Even if the US tax liability is offset by credits for Australian tax paid, the cost of compliance and the constraints placed on financial planning are real.

Today, Rebekha Sharkie, MP for the electorate of Mayo in South Australia submitted the following question:

312 MS SHARKIE: To ask the Treasurer—

(1) Why was superannuation excluded from the 2001 revision of the USA-Australia tax treaty.

(2) Is it a fact that the 2001 revision of the treaty was focused on businesses rather than on individuals.

(3) Has the Treasurer received any advice on revising the treaty to address issues with taxation of superannuation; if so, can the Treasurer provide any such advice (or if not possible, can a summary of each advice be provided to the House).

(4) Is the Treasurer aware of changes in the past decade in US practices in the enforcement of the Foreign Account Tax Compliance Act as it applies to ‘US persons’ that are also residents of Australia for tax purposes, or Australian citizens that reside in Australia and are subject to Australian taxation.

(5) Has the Government been advised of any such changes by the US Government; if so, could the Treasurer provide the advices (or if not possible, can a summary be provided of each of these advices to the House).

(6) Has any such change in US practice increased the costs to Australian citizens and tax residents that are required to comply with US tax rules; and what is the estimated total cost of treaty and extra-territorial US tax compliance for Australian citizens and Australian tax residents over the forward estimates broken down by financial year.

(7) Under the treaty and related instruments: (a) under what circumstances would Australian citizens and tax residents be paying both US and Australian taxes (however arising); (b) can the Treasurer detail each of these circumstances; and (c) has the Treasurer received any advice concerning any of these circumstances, or concerning the potential or reality of double taxation under current treaty arrangements more generally; if so, can these advices be provided (or if not possible, can a summary of these advices be provided to the House).

(8) What is the number of: (a) Australian citizens; and (b) Australian tax residents; that pay US taxes on Australian income (however arising, including salary, superannuation contributions and distributions, home ownership, business ownership, and any other investments).

(9) Broken down by financial year over the forward estimates, what is the: (a) total cost from the treaty to Government revenue; and (b) total capital removed from Australian superannuation accounts and the Australian economy due to extra-territorial taxation by the US Government (including Australian superannuation contributions and distributions).

(10) What review and monitoring mechanisms does the Government have in place to identify issues arising out of the operation of the treaty.

(11) To date: (a) what concrete steps have been agreed to in order to resolve the issues identified in the US-Australia tax treaty; and (b) what are the deadlines for completing each of these steps.

(12) In tabular form, can a list be provided of the notifications (and a brief description of each individual notification) provided by the US and received by Australia pursuant to Article 2, Paragraph 2 of the treaty.

(13) Will the Government commit to a renegotiation of the treaty; if not, why not; if so, in which year does the Government: (a) expect to commence those negotiations; and (b) intend to conclude negotiations.

Any MP can direct Question in Writing to the appropriate Minister. There is no requirement that the question be answered, but it remains on the list of unanswered questions until it has been answered, withdrawn, or Parliament is dissolved. If a question is left unanswered for 60 days, then the MP who asked the question can ask why there is a delay.

I will be quite interested to hear how the Treasurer answers this question.

Have you written your MP yet?

Following Karen’s recent Call to Action! post, we are starting to receive  positive feedback on our Open Letter – Extra-territorial Reach of US Tax Reform Legislation from our elected representatives here in Australia.  This campaign is well aligned with the core purpose of our group being  advocating for the Australian Government to renegotiate the under-pinning legacy tax treaties and intergovernmental agreements to provide a fair go for all Australians.

The Open Letter seeks to draw the Australian Government’s attention to an emerging harmful consequence of US extra-territorial taxation as part of US tax reform but it also serves as an opportunity for you to open a dialogue with your elected representatives about the pressing need for Australia to address the many deficiencies in the current Tax Treaty that disadvantage Australians with US ties.

We’ll share some of the positive feedback we received, but first, we want to again remind all of our members to please write your MP / Senators about this issue.   Presently, our follow-up survey suggests that only seven MPs have been contacted to-date, suggesting that only a small fraction of our membership have taken action.  Most Senators from NSW, QLD, SA and VIC have received at least one letter, making a total of 44 Senators who have been contacted. We have yet to hear from anyone in ACT, NT, TAS or WA who has contacted their representatives.  Without your active involvement, affecting positive change will be difficult.

Continue reading “Have you written your MP yet?”

Citizenship matters…

Storify is being de-commissioned. The story originally posted here is on the Internet Archive . You can also find it at Wakelet.