Letters calling for the elimination of FATCA, among other tax issues, will be presented to the White House in about two weeks’ time.
Photo: Republicans Overseas’ Michael DeSombre says a tax reform provides an opportunity to repeal the act which is particularly unpopular among American expatriates.
A global political organisation with affiliation to the Republican Party has recently launched a petition and letter writing campaign in protest of “citizenship-based” taxation – partly in form of the controversial Foreign Account Tax Compliance Act (FATCA) – as congressmen in Washington debate a tax reform.
The Republican Overseas (RO) group, with active membership in some 40 countries, is hoping to garner support from some five to ten thousand people when Solomon Yue and Michael DeSombre, its CEO and Worldwide President respectively, travel to the White House on 2 October, 2017.
“Lots of businessmen have huge issues with FATCA,” DeSombre, who is based in Hong Kong since 1997, tells HT. “This letter writing campaign focuses more on moving away from worldwide taxation to a territorial taxation system, which is more in line with what every other developed country has. The US is currently rather an outlier in that respect.”
FATCA was implemented in 2010 in wake of the global financial crisis as an attempt to target undeclared offshore accounts held by Americans. Critics claim that the move has created difficulties for expat American citizens.
DeSombre says that the RO is also coordinating with other non-partisan organisations such as the American Citizens Abroad and American Association of Residents Abroad to send their message to Washington. He notes that the campaign also receives support from some members of the Democrats Abroad on a personal basis.
“Most people have been expecting some degree of a tax reform to happen. It has been 31 years since the last comprehensive tax reform in the US and there are lots of problems in the US tax system. Some of the easier ones are in the corporate tax area but people also understand that individual tax needs to be updated,” DeSombre puts. “Generally speaking, a tax reform is much more likely to occur now because of the Trump presidency, and because the Republicans also control the House and the Senate.
“So the hope is that the promised tax reform will happen and all of corporate and individual tax issues will be dealt with, and one of them is worldwide taxation,” he adds.
The RO is also seeking to secure a meeting with Wilbur Ross, US Secretary for Commerce, regarding the topic as Ross visits Hong Kong later this month. On 27 September, Ross will speak at a breakfast session hosted by the American Chamber of Commerce in Hong Kong which has already indicated its support for the campaign.