Wednesday, May 9, 2012

Foreign Account Tax Compliance Act (FATCA)

Call, mail, or email your senator and House representatives to repeal this stupid law. It is destroying the ability of Americans to work overseas, and will probably majorly affect the ability to even invest in overseas ventures. Seems like a great idea on paper, what with forcing American companies not to outsource, but nobody on the Hill seems to have used their brain to realize these companies and their CEOs/owners will just leave the country altogether to do business elsewhere. You think there is a country in the world that wouldn't want Microsoft (as an example) to be hosted in their country completely? The tax law requires foreign banks to comply by disclosing all deposits and earnings by American citizens or else they will not be able to do business with any American banks. So rather than deal with the hassle and massive cost increase (some are suggesting an entire team to deal with the law) they are just ditching American customers, and denying new ones.

I agree with the premise of the law, to deal with Americans who hide their cash in offshore accounts to avoid taxes on money made in America. If the money is made in another country, it should fall under the tax laws for that country. If they want to bring it back here to the states for use, then you can tax it, but that tax should be about 5% and definitely no more than 10%. Let's be honest though, even with all of the supposed tax evasion going on (which they can't prove or there would be actual court cases) the people they're accusing still pay a ridiculous percentage of total yearly taxes. They are not the problem, the problem is with the lower 40% or so that not only effectively pays no taxes, but the ones that recieve back more money in their tax return than they even paid in! I only marginally mind people effectively not paying taxes, what I do mind is when they get back more than they put in.

It's mildly amusing how they are all about disclosure of private company and individual's money, but not so much with government employees (you know, those people like Hillary Clinton who get all the inside info about what bills are coming down the pipe so they can make millions off the stock market while the rest of us would go to jail). This bill being a specific example. Rather party line vote for that one too, nearly all the Dems voted against having high lvl executive branch members be required to publically disclose their earnings while the Repubs voted for it. Private disclosure to the government is alright, but government disclosure to the public is such a bad thing, right?

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