Overseas Americans ramp up bid for tax relief

Overseas Americans ramp up bid for tax relief
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Organizations representing millions of Americans who work abroad are storming Capitol Hill in a push for tweaks to tax and banking policy.

American Chambers of Commerce (AmChams) operating in various countries all over the world collectively represent about 6.5 million U.S. citizens living outside the country.


Some, such as the AmCham Abu Dhabi, are stepping up their Washington advocacy, visiting with business groups, lawmakers and administration officials, just as Congress grapples with tax reform.

Their message: Well-meaning policies aimed at stopping money laundering and offshore tax evasion have translated into unworkable realities for Americans overseas.

“Our intention coming onto the Hill was to educate and present our case — what we’re facing, in terms of challenges in living abroad,” said Sharief Fahmy, chairman of AmCham’s public affairs committee for the U.S. and the United Arab Emirates.

“A lot of banks are finding it harder to support American businesses overseas,” said Fahmy, who is also chief executive of F&E Group, a company that organizes large events. “We’re looking to make Americans working abroad more competitive.”

AmCham Abu Dhabi recently took its message to tax-writing committees in Congress and met with Treasury Department officials, explaining the costly process of doing taxes and frequently troublesome task of basic banking.

Americans living and working abroad complain that they are essentially double-taxed. The United States and Eritrea, a small country located in the Horn of Africa, are the only nations that tax the incomes of non-resident citizens. Unlike the U.S., Eritrea offers a discount for its citizens living elsewhere.

Fahmy said the group’s message had “grown roots,” thanks to the Capitol Hill blitz.

“The overall advice we’ve gotten is that there’s a global issue here, and we need to find a unified platform to have a unified voice,” he added. “So that’s my homework that I’m taking back, trying to figure out how to do that.”

This is the 15th year that Americans working in Abu Dhabi have made the advocacy trip, but this time they are looking to create a lasting voice in Washington.

The Abu Dhabi group hired a team of lobbyists at law and lobby firm Williams & Jensen as part of an attempt to continue the dialogue with policymakers after its members returned to the U.A.E.

Meanwhile, other AmCham groups continue to flock to Capitol Hill, and lawmakers can expect to see more of these groups into the summer months.

AmCham in Egypt has an upcoming trip planned to Washington and the Asia Pacific Council of American Chambers of Commerce (APCAC) — a consortium of AmCham groups — will take its turn in June.

“What these guys do — which is better than me as Joe Lobbyist — is come in and say, ‘Let me tell you how this provision is impacting my ability to do my job in promoting U.S. corporations in foreign markets,’” said Loren Monroe, a principal at BGR Group, which has represented APCAC since 2011.

Last year alone, the firm helped organize 70 visits on Capitol Hill for APCAC members to meet with lawmakers, senior aides and committee staffers.

The large regional consortiums of various groups, such as APCAC and the AmChams in the Middle East and North Africa — including Abu Dhabi and Egypt — may have individual member groups that disagree on specific policy issues, but the taxation issue has largely been a rallying cry for all.

Americans working overseas have also found problems with the Foreign Account Tax Compliance Act, which became law in 2010 to help crack down on tax evasion. Now in full effect, critics say the law requires burdensome amounts of paperwork and disincentivizes foreign companies from hiring — or even working with — Americans.

For example, foreign financial institutions that deal with Americans must report to the IRS, detailing the names and assets of all customers who are U.S. citizens. Some working abroad have had accounts closed or their business refused.

The renewed fight for relaxed rules comes at a crucial time for congressional action, when the debate around tax reform is beginning to pick up steam.

Last week, the Senate Finance Committee released letters submitted by individuals and groups with input on areas of interest. Many U.S. citizens living abroad individually wrote to the panel.

Japan’s AmCham sent its letter on Tax Day, calling the U.S. reporting requirements for income and financial accounts of Americans living outside its borders the “most cumbersome, costly and disproportionately punitive” of any country in the world.

“It is critical in this age of rapid globalization to have American citizens able to gain frontline operational competencies in an increasingly sophisticated economy while serving U.S. interests day to day in markets around the world,” the letter reads. “With tax reform on the table, this is the best shot in many years to resolve some of these policy complications — and groups who represent Americans working abroad plan to keep up the pressure.

Fahmy of the AmCham in Abu Dhabi says he will be working on ways to help other organizations with leveraging advocacy and information when speaking with U.S. policymakers.

“The issue has touched on the little fish, and the little fish are speaking out, but we need a bigger voice,” he said.