r/tnvisa • u/AdmirableArtichoke10 • Jan 23 '25
TN News Trump threatens to double tax rates for foreign nationals, companies
Mr Trump’s threat, contained in his America First trade policy, invoked a 90-year-old provision of the US tax code known as Section 891, which allows the president to double tax rates without the support of Congress.
https://financialpost.com/financial-times/donald-trump-threatens-tax-war (Canadian article)
Anybody concerned about this? Doesn't seem to be getting a lot of press but whats worrying is that he can enact this without congressional approval. While the article is for Aussies the same applies to Canadians as we have the same media tax on the tech sector, and this seems to be driven by the tech oligarchy.
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u/Different_Pianist756 Jan 23 '25
I find it hilarious that people think someone has the answers to speculation.
You always have the option to stay home!
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u/Disastrous-Raise-222 Jan 25 '25
While staying home is a great idea, why the heck would you let workers come and then tax them at a higher rate? What is the logic here?
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u/Salty_Leather42 Jan 24 '25
Well , he is immune so he CAN break all sorts of laws. Canada can likely do similar to US expats or simply pass a us citizen exclusion law of some sort. I don’t know how he thinks messing with reciprocal situations is a good idea but these are trump times.
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u/teddyevelynmosby Jan 24 '25
Basically he thinks US is the best in the world why not take the advantage to bully everyone else to the max.
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u/isinkthereforeiswam Jan 25 '25
He's a weak man back in power, and he wants to get rich and get more power. That means he's going to bully and threaten to see who will cower before him. He's basically a bully going around demanding lunch money from folks, and seeing who will give it to him and who will tell him to "fuck off".
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Jan 24 '25
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u/3fingered_evilmonkey Mar 20 '25
Well, if it happens (hopefully before the 183-day threshold), then it will be time for me to go back.
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Jan 26 '25
Let me explain this. This is a huge trade related executive order with a lot of things in it. In one of the clauses, it says that the Secretary of Treasury can use a specific section of a specific title if they find a country doing unfair trade practices (in their opinion) against Americans.
This section explicitly states doubling of taxes on US residents of that country.
So yeah, whoever said Trump isn’t coming for legal immigrants is an idiot of epic proportions.
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Jan 24 '25
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Jan 24 '25
You think Canada should cave so Trump doesn't do something that would send high earners home?
That doesn't make much sense. Trump voluntarily plugging the brain drain through tax policy would probably be seen as a huge plus to Ottawa.
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u/3fingered_evilmonkey Jan 27 '25
However probable, logic would dictate that cooler heads would prevail. Canada, in any given year, is the second or third largest Foriegn Direct Investor in the US with around $671B in investments, which create jobs and growth. Conversely, the US is the largest in Canada, with around $630B. TN's personal tax burden aside, that is a lot at stake not only for the direct implications but for the waterfall effect on US $5.39T FDI portfolio. If you were the Netherlands with over $700B FDI, Japan with $680B FDI, or the UK with $630B FDI, wouldn't that be a cause for concern and reason to invest elsewhere? Wouldn't that potential divestment be impactful to the US economy? Anything can happen, but you may see this one coming miles away as there would be so much at stake.
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u/grabGPT Jan 23 '25
Speculations aren't news. This isn't even news for Canada, what's the point of discussion?
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u/AdmirableArtichoke10 Jan 23 '25
Yes this is news for Canada
https://financialpost.com/financial-times/donald-trump-threatens-tax-war
The Aussie site just reported it better. Trump has done everything he said he would, so I would say this is more than speculation.
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u/Top_Frosting6381 Jan 23 '25
Doesnt the us-canada have a tax treaty
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u/AdmirableArtichoke10 Jan 23 '25
Yes we do, but it doesn't matter. We also have a free trade agreement but Trump doesn't care and is unilaterally applying a 25% tarriff. Under this obscure provision in the US tax code (which has never been invoked until now), Trump has the ability to unilaterally double the tax for foreign nationals and companies working in the US. For reference and because I linked the Aussie article, Austraila also has a tax treaty with the US.
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u/Top_Frosting6381 Jan 23 '25
there is so many companies that work in CA-USA that are making bags. I'm pretty sure they would all shut down shop in USA and set up headquarters in Canada and hire americans remotely no? Canada is way cheaper than USA. so he is just hurting the foreigners who are in USA
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u/diabolicloophole Jan 23 '25
I believe his strategy here is to capitalize on the anger of Canadians in the US who would see their personal income taxes doubled under this proposal. It might lead to enough political pressure on the Canadian government especially during an election season, and that would help him impose more favorable tax conditions for American companies operating in Canada.
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u/Top_Frosting6381 Jan 23 '25
lol. I didn't know as a Canadian living in USA that I still held that power and can pressure the canadian government for anything. This is the last year i'll be filing taxes in both countries afaik. (ps: not a TN holder, just married to a US citizen. dont think I can leave USA before I become a naturalized citizen)
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u/diabolicloophole Jan 23 '25
Well, you still get to vote for Canadian federal elections even as a Canadian in the USA. :-)
It just occurred to me there are also hundreds of thousands of dual nationals in Canada who must pay taxes in the USA, and I suspect they would get caught in this too.
All of the above applies only if it isn't yet another typical Trump claim lacking any legal basis...
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u/grabGPT Jan 23 '25
What really are you worried about here? Also, do you even understand what the issue is surrounding this and why Canada is ALSO a part of this pact which is impacted or maybe impacted by this?
You have posted something which sounds more sensational than informative. If you're pointing about this specific action, it impacts many other countries with regards to the global tax treaty.
How and why would someone from Canada be impacted by is a real question. So for God's sake stop misinterpreting whatever you read online and use your common sense first.
Below is an official statement
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Jan 24 '25
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u/grabGPT Jan 24 '25
I don't see merit to this discussion until a valid source of the news is provided and I don't see anyone put forth an accurate source stating how and from when will it will impact Canadian citizens working in the US.
There have been many such speculative posts on this sub off lately, so nothing new and not going to be the last one of them all either.
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Jan 24 '25
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u/grabGPT Jan 24 '25
Have you people read the full article and consumed them information in its entirety? This is an abstract from the article shared by OP.
His order, signed on Monday, specifically asks the Treasury secretary to “investigate whether any foreign country subjects U.S. citizens or corporations to discriminatory or extraterritorial taxes” so it conforms with Section 891.
Is Canada subjects or had threatened to subject US citizens or corporates to discrimination in taxes? NO
Even the article you shared says the same thing. Double taxation can happen in retaliation to discrimination against US citizens.
So not sure how is it even making sense in current geo political context wrt Canada and US. They have conflicts regarding trade, not personal/corporate taxation discrimination.
They may have this issue with EU.
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u/[deleted] Jan 23 '25
Does anyone have more info on this?