Two dual Canadian/US citizens have challenged a federal court ruling over the country’s upholding of the Foreign Account Tax Compliance Act (Fatca).
Fatca requires foreign financial institutions to share American citizens’ account information with the Internal Revenue Service (IRS) for tax purposes.
Gwendolyn Deegan and Kazia Highton’s argument is that the US legislation breaches Canada-US tax treaties and the Canadian Charter of Rights and Freedoms, as the information is shared without consent.
Section 8 of the Charter protects citizens from the “unreasonable search or seizure” of information.
But their case was dismissed by Canada’s federal court in July 2019.
The pair is now trying to raise C$135,000 (£82,379, $101,263, €92,446) through the Alliance for the Defence of Canadian Sovereignty, a non-profit organisation defending Canadians “from the attempt of other countries to impose their legislation on Canada”.
They believe that “the best chance for resolution will be at the supreme court”, which would be their next port of call if their court of appeals bid fails.
Across the pond
Similar challenges have also been made in Europe.
On 1 October 2019, the Dutch state secretary for finance, Menno Snel, told lawmakers that banks based in the Netherlands should not refuse to serve Americans for fear of being found in breach of Fatca.
Whereas, in the UK, International Adviser reported in September 2019, that a US-born British citizen known as Jenny is suing HM Revenue & Customs.
She argues that the UK’s compliance with Fatca is in breach of the EU’s General Data Protection Regulation (GDPR) as she did not consent to having her financial information shared with the IRS.
Past legal bids to overturn Fatca, however, have not been successful; with France’s top court dismissing a case in July and Israel similarly rejecting a lawsuit to overturn the legislation in 2016.