On April 26, Rep. Mark Meadows chaired a hearing of the House Subcommittee on Government Oversight examining the destructive impact of FATCA. Rep. Meadows is sponsor of the House FATCA repeal bill (H.R. 2054); the companion Senate bill (S. 869) is sponsored by Sen. Rand Paul, who was the lead witness in the House hearing. The full hearing video is available here:
The hearing is another step in setting up the Meadows-Paul repeal measure for inclusion in any upcoming tax bill. Foreign banks have been dumping American clients, FATCA is a primary factor of Americans abroad renouncing their U.S. citizenship, and the compliance industry has lined its pockets thanks to this destructive “fat cat” tax law that has become an unmitigated flop.
During Wednesday’s hearing, Sen. Paul excoriated FATCA as an unconstitutional breach of Americans’ privacy. “My hope is that this hearing will shed some light on this abusive law and lead to a demand for action,” Sen. Paul said during his testimony. “Chairman Meadows and I have sponsored a bill to correct this injustice and repeal FATCA. Congress should pass our bill this year and put an end to this madness.”
Sen. Paul’s full testimony is available here:
As expected, the witness called by the Democratic minority sought to defend FATCA by citing the problem of offshore tax evasion. No one denies tax evasion in a problem, but FATCA is not the right remedy nor an effective enforcement tool. In fact, the pro-FATCA witness even called for domestic US banks to conduct the same warrantless data searches FATCA imposes abroad.
Predictably, FATCA defenders resorted to sleaze, baselessly accusing repeal advocates of wanting to “make life easier for overseas tax cheaters.” As Campaign to Repeal FATCA Co-Leader Jim Jatras wrote in an April 26 commentary in The Hill, “talking about tax evasion to justify FATCA is comparable to ‘defending’ America’s catastrophic experiment with the prohibition of alcohol by reciting the litany of the ravages caused by Demon Rum.”
Representative Meadows and Senator Paul introduced their companion bills to repeal FATCA in early April. Both lawmakers also wrote Treasury Secretary Steve Mnuchin and OMB Director Mick Mulvaney urging executive actions to “mitigate the ongoing damage” caused by FATCA.
Coinciding with today’s hearing, the U.S. and world credit union industry came out strongly for FATCA repeal. In a joint letter to Paul and Meadows the Credit Union National Association (CUNA) and World Council of Credit Unions (WOCCU) declared their support for the repeal legislation.