Is FATCA A "Hammer Blow" For The U.S. Economy? – ValueWalk Premium
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Is FATCA A "Hammer Blow" For The U.S. Economy?

History will ultimately teach us that America’s far-reaching new global tax law, FATCA, which came into effect Tuesday, is a “hammer blow for the U.S. economy”, warns the founder and chief executive of one of the world’s largest independent financial advisory organizations.

Is FATCA  A "Hammer Blow" For The U.S. Economy?

Nigel Green’s warning in response to FATCA

The stark warning from Nigel Green of deVere Group, which has $10bn under advice and management, is in response to the Foreign Account Tax Compliance Act (FATCA), better known as ‘FATCA’, which was implemented by Washington yesterday.

Mr Green explains: “Potentially, FATCA is a ticking time bomb that threatens the long-term sustainable growth of America’s economy and its international economic standing.  There are three primary reasons for this.

Reason why FATCA is a “hammer blow” for the U.S. economy?

“First, a considerable reduction in future foreign investment is now, I suspect, inevitable as sensible overseas investors will, not unreasonably, prefer to put their funds elsewhere due to the heavy penalties of not fully complying with FATCA’s preposterously onerous regulations.

“Second, further capital flight is a real and serious possibility due to the current investment climate characterized by suspicion.  According to the Texas Bankers Association, $500 million had already ‘flown’ from the state’s banking system by the early part of this year as a direct result of the IRS rules.”

“And third, U.S. businesses that operate internationally are now routinely rejected from foreign banks and other financial institutions.  Having no access to non-U.S. financial institutions in countries where they do business significantly reduces their competitiveness.

“For these reasons, plus a host of others, I believe that history will ultimately teach us that FATCA is a hammer blow for American jobs and the broader U.S. economy.”

He adds:  “As such, I will continue to voice my calls for this damaging tax act – which cannot possibly effectively achieve its purported aims of combatting tax evasion – to be definitively repealed.

“I will also continue to champion the legal and constitutional challenges being prepared by the likes of American super-lawyer Jim Bopp Jnr and the Alliance for the Defence of Canadian Sovereignty.”

About deVere Group

deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients. It has a network of 70 offices across the world, more than 1,200 staff, over 80,000 clients and $10bn under advisement.

www.devere-group.com

Comment (1)

  • BC_Doc

    I left the US over 20 years ago to study medicine in Canada. I became a Canadian in 2001, and now live, work, and raise a family in western Canada. I plan to retire here and have no plans to return to the US.

    As a result of FATCA, I divested myself of all US holdings earlier this year (ie, equities traded over the NY Stock Exchange). In order to safeguard my future retirement, my investments are now all held in Canada. Any equities trade over the Toronto Stock Exchange– because of US overreach, I will not leave a cent invested in the US. That giant sucking noise is the sound of capital flight.

    July 2, 2014 at 6:36 pm

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