Expats have vowed to carry on their fight to challenge the controversial Foreign Account Compliance Tax Act (FATCA) despite setbacks in the courts.
The Republican Overseas Action Group has lost two court actions demanding the repeal of FATCA in the US.
In January, the case led by Republican senator Rand Paul was lost in a district court, with the judge ruling that the plaintiffs did not have the legal standing to bring the case.
A few days ago, the US Court of Appeals upheld the lower court’s decision.
Now the lobby group intends to take the case to the US Supreme Court.
Inconsistent with federal law
“I am very surprised that the court is unwilling to recognise the very real harm that FATCA is imposing on overseas Americans,” said James Bopp, lead lawyer for the plaintiffs.
“The court maintains that the decisions of banks not to serve US citizens is just a voluntary decision on their part, not as a result of FATCA. They also state that those citizens who have not filed their FBAR or FATCA forms are under no threat of prosecution.
“Their analysis is convoluted and imposes restrictive standing requirements that are inconsistent with federal law.”
The action group has pledged to take the fight to the higher courts and is calling on expats to help fund the action.
“Fighting in the Supreme Court is going to be expensive,” said Solomon Yue, vice chairman and CEO of the group.
Fight against tyranny
“We need all privacy-loving overseas Americans to financially support this endeavor so we can get rid of FATCA tyranny once and for all.”
FATCA was introduced by former President Barack Obama in 2010. The law gives powers to the Internal Revenue Service to demand reports about the financial standing of US taxpayers with foreign financial institutions.
If a foreign financial institution fails to comply, the US government can take sanctions that could end with freezing the organisation out of the US banking system.
More than 100 countries and nearly 300,000 financial institutions deliver the data on offshore bank accounts and investments controlled by US taxpayers.
The Republicans included repealing FATCA in their election policy promises, but so far, no action to scrap the law has been forthcoming in Washington.