Treasury tweaks global tax dodge law one last time

WASHINGTON Thu Feb 20, 2014 3:50pm EST

The U.S. Treasury building is seen in Washington, September 29, 2008. REUTERS/Jim Bourg

The U.S. Treasury building is seen in Washington, September 29, 2008.

Credit: Reuters/Jim Bourg

WASHINGTON (Reuters) - The Treasury Department moved on Thursday to shut the door on further 11th-hour tweaks to a new law set to take effect on July 1 that is meant to fight offshore tax evasion by Americans.

The Foreign Account Tax Compliance Act (FATCA) was enacted in 2010 and has undergone successive delays and revisions, with banks even now saying more time is needed to get ready for it.

But a Treasury Department statement said that the largely technical reporting changes released on Thursday are "the last substantial package of regulations" needed to implement FATCA.

Treasury officials said the latest fixes would prevent another delay to a law that already has been twice postponed.

An official told reporters: "We're going full-speed ahead for getting this implemented by July 1. We don't see any likely event that will cause us to change that."

Congress passed FATCA in response to a scandal involving Americans hiding money in Swiss bank accounts. The law requires foreign banks to share information about Americans' accounts of more than $50,000 with the U.S. Internal Revenue Service.

Foreign institutions that fail to comply with FATCA face a potential 30-percent withholding tax on U.S. source income that could effectively freeze them out of U.S. financial markets.

The latest changes to the law are highly technical and involve making it easier for some foreign financial institutions to report customer information to the United States, addressing the concerns of both U.S. and foreign banks.

Before Treasury announced its FATCA rule changes, four banking groups called for a six-month delay to the law, saying businesses did not have enough guidance to guarantee they were complying with the law.

(Reporting by Patrick Temple-West; Editing by Kevin Drawbaugh, Howard Goller and Andrea Ricci)

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Comments (4)
tatman wrote:
“Before Treasury announced its FATCA rule changes, four banking groups called for a six-month delay to the law, saying businesses did not have enough guidance to guarantee they were complying with the law.”

more like 6 months to shield and move their customers to new safe havens, and to cover up their tracks in order to protect their own sorry a$$es and the billions in funds of the mega rich american plutocracy.

Feb 20, 2014 1:27pm EST  --  Report as abuse
brotherkenny4 wrote:
Why don’t they just have the banks write the law like they usually do? Oh wait, that’s what this tweak is, adjusting the law so it’s toothless and useless. Just as the banks dictate.

Feb 20, 2014 1:58pm EST  --  Report as abuse
JamesChirico wrote:
The law should be changed to ask for all US transferred amounts on accounts without a name nor tax ID. Life in prison for Americans not giving their tax ID to foreign banks should also be put in. Banks that do not comply besides the thirty percent should be forbidden to trade in our markets and not transfer funds to/from US banks. We also should do the same for foreigners with money in our banks avoiding their own country taxes.

Feb 20, 2014 2:21pm EST  --  Report as abuse
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