Senator Rand Paul’s effort to block FATCA denied by Ohio judge
It’s disappointing to hear of the ruling by a Federal judge in Ohio claiming that Republican presidential candidate, Senator Rand Paul, and others, do not have the ‘standing’ to challenge the Foreign Account Tax Compliance Act (FATCA).
In legal terms, ‘standing’, in essence means you need to prove that something is happening to you in particular.
Rand Paul became the first presidential candidate to sue the government he aims to lead, as the senator from Kentucky took legal action against the Treasury and IRS on the renunciation of his right to vote on over 100 tax treaties with other governments.
As such, and as I stated in an earlier blog at the end of June, I have been an avid champion of Senator Paul’s lawsuit, which claims that Obama’s administration failed to consult the U.S. Senate about such treaties, or ‘intergovernmental agreements’, as part of FATCA – the law that its supporters claim will help the U.S. government catch tax evaders stashing money overseas. A noble aim indeed – but one that FATCA cannot and will not achieve.
Judge Thomas Rose has declined preliminary injunctive relief on the various claims made by the ‘Republicans Overseas Action’ organisation – made up of Senator Paul and another six opponents – against the highly controversial law because, according to the judge, these claims are “remote and speculative harms, most of which would be caused by third parties, illusory, or self-inflicted.”
So why was the injunctive relief denied?
Judge Rose is a supporter of FATCA, and is of the belief that taxpayers should reveal their offshore bank details to the IRS on a “rational basis”, unlike the claims made by Rand Paul and the other opponents.
Consequently, the judge stated: “Senator Paul has not been authorized to sue on behalf of the Senate. Legislators don’t have a legally protected interest in proper application of the law different from anyone in the general public.
“The plaintiffs’ allegations also fail as a matter of law, as there is no constitutionally recognized right to privacy of bank records.”
In response to this ruling, the plaintiffs’ lawyer, James Bopp, said last week: “We are seriously considering our next legal step, considering the pain and hardship those laws continue to inflict on all overseas Americans.”
I’m hopeful superlawyer Bopp will come forward with a robust plan and this law is resigned as a ‘blip’ in the history books. As I was quoted as saying in another blog, the host of unintended consequences associated with FATCA is astounding, and presidential candidates must justify their stance on this tax law ahead of next year’s election. As Senator Paul has done.
The figures speak for themselves. deVere Group carried out a survey over summer which revealed that 78 per cent of Americans overseas say they would vote for a presidential candidate who vowed to consider an overhaul of the U.S. citizenship-based tax system.
At the time I was quoted as saying: “The survey reveals how the vast majority of Americans living and/or working abroad want a radical overhaul of the law that taxes individuals based on their citizenship, rather than their residency.
“The estimated 8.7 million U.S citizens overseas are incredibly disadvantaged by America’s draconian citizenship-based taxation regime as they are victims of double-taxation.”