Expat Value to Canada

[canexpat]

It is estimated that there are as many as 2.5 million Canadians that have found a life (some temporarily & some permanently) abroad. Recent events and current politics have collaborated to create the ugly term "citizens of convenience". This is a derogatory term that implies that Canadian expats not only do not contribute anything to Canada but actually sponge off the country when in need.

The Canadian Expat Association strongly believes however that expats provide real and tangible value to their home country. Expats promote Canada and its products and in some cases create whole markets. Expats that eventually return to Canada do so with an entire new set of unique skills (cultural sensitivity, linguistic skills, business contacts). There are many others but we would love to hear from you.

What do you believe Canadian Expats contribute to Canada? Do you have some specific examples of where an Expat (perhaps yourself) has provided a specific value back in Canada?

-or- Perhaps you might take an opposite view, that expats provide no value at all. I would still love to hear from you.

Allan Nichols
The Canadian Expat Association
http://www.thecanadianexpat.com

[wifeinasuitcase]

Hi Allan:

To start with, I question why expat Canadians should need to prove their value to Canada. Does anyone living in Canada need to prove their value to the country?

Expat Canadians get no benefits from Canada, no healthcare, no EI, cannot contribute to CPP, cannot vote. If they want to be non-resident for tax they must sever all ties – give up their home, surrender their driving licence, close bank accounts, etc. All they have is their passport and given the few high profile cases in the press recently about the lack of assistance provided to Canadians in trouble overseas, you have to question what value that has these days!

Now I sound like a very disgruntled expat, but I’m not, I’m just confused by the mixed messages I’m getting. On the one hand I’m supposed to turn my back on the country and yet also prove my allegiance to it?

In answer to your request for examples, here’s one from my own experience – the International Terry Fox Runs. They are currently held in about 30 countries around the world and spread a huge amount of goodwill towards Canada. For those who don’t know, Terry Fox Runs must be organized with a zero budget – everyone involved must be a volunteer and all the logistics required must be donated. All supporters are thanked and treated equally – from the child who donates 25 cents to the corporation which donates thousands of dollars. In most cases the funds raised are spent locally on cancer research initiatives and so benefit the local economy. I can’t tell you how much good PR Canada receives from these extremely ethical and charitable events and they are generally led by expatriate Canadians.

[canexpat]

Thanks wifeinasuitcase for the response,

Yep, you do sound a little disgruntled but you are certainly not alone.

We are having a 'get together' in Ottawa with some fairly influential individuals on October 20th. This is the type of sentiment I want to the convey and the Terry Fox example is perfect.

Regards,

Allan

[Steven]

The real problem (as I've expressed to my MP) for Canadian business and individuals is departure tax. At the end of the day everything comes back to individuals, say you own a corporation, so assets can always be liable to departure tax. Paul Martin made the rules for it really tough, and the problem is that it causes problems with movement of capital.

Say for example you as a Canadian want to expand business operations into the US, and you own the Canadian corporation, or part of it. However you need to relocate to the US for a few years to oversee the start up. You get your L-1, E-1 or whatever and move to the US. This exposes you to departure tax on the proportion of the assets of the parent company attributable to you as a percentage of the company that you own, which hinders your ability to expand the company abroad.

Taxing capital transfers is unusual and the way Canada does it is almost unique. Plus the CRA continually gets more aggressive about collecting this tax.

It also discourages foreign investment in Canada for the same reason, people move to Canada, start up a company and then leave - and those capital gains (the increase in the value of their investment) attributable to them are taxed at that point, not the point of actual disposal which would usually come later.

You can pro-rate departure tax to the amount of time spent abroad, but that makes calculating what your liability is even more complex.

So if you're having a meeting with people in Ottawa, mention this please!

[canexpat]

Perfect Steve,

To be honest, I wan't even aware of this issue. Thanks for bringing it up. This sounds like an issue that our Chambers of Commerce and Business Council members should be active in as well.

Allan