Read the title, thought "They're Canadians, screw them and take their money."
Then I read the article and at first I was like "Huh, they need to fix that policy" then it switched to "wait their traitors who fled the country. Screw them and take their money."
In all seriousness though, this seemed weird so I looked it up. I understand (and generally approve) of how foreign income is taxed, which is what I thought this was. Really though this is about foreign assets and something called the FBAR. Anyways, here's what I found:
This is the IRS following the letter of the law. Its not the IRSs fault. In fact the law behind this, the FBAR, is actually a really good law for what it was intended to do: prevent money laundering (which is even more of an issue today than it was when it was started.) This is why the penalties are SO big.
The problem is that most people don't recognize this as an actual issue. See, if I had a large stockpile of unregistered fire-arms, I would understand "hey, this is clearly illegal because it could clearly be used for criminal stuff." Whereas not reporting the 500k retirement savings I have in Canada because I live in Canada.....you don't think of that like a large stash of guns.
But in some cases that's really what it is (or its on its way to become that.)
This is definitely a tricky issue. You want to have a strong motivation for people to report this stuff, but you don't want to go so far as has gone here. My guess is that another round of amnesties will come through for the individuals in question, or some kind of agreement will come about between the Canadian and US government.
That said if you failed to file this for 35 years.......I mean ffs take some responsibility for your actions, or lack thereof.
Also here's a cool story from wiki about why this is and should be taken so seriously (at least at the corporate level.)
http://www.guardian.co.uk/world/2011/apr/03/us-bank-mexico-drug-gangs
Edit: But nbd it is far easier to write one-liners about how this is just another symbol of the imperial USA and how reminiscent this is of people defecting from the Soviets (2 comments from the article.)
There's a lot of stupid out there. At least take the time to do 5 minutes of investigation on the issue. If you're unwilling to look into arguments/assertions before accepting them at face value then you're guaranteed to end up being someone's slave
