Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesHot NewsMost Read NewsRecomm.Business LeadersCalendar 

U.S., 5 Others Strike Agreement to Combat Offshore Tax Evasion

share with twitter share with LinkedIn share with facebook
share via e-mail
0
07/26/2012 | 03:24pm CEST

--Treasury releases model agreement to obtain U.S. taxpayer information through foreign governments

--One version of agreement requires the U.S. to exchange information about foreigners that it collects from domestic banks

--Agreement developed with U.K., France, Germany, Spain and Italy

(Adds details about Thursday's agreement starting in the third paragraph and additional background throughout.)

   By Eric Morath 
 

WASHINGTON--The U.S. Treasury released a model agreement struck with five European nations Thursday that will allow for the enforcement of a law that targets offshore tax evasion.

The agreement, which still must be finalized, would create a new global regulatory system to prevent Americans from dodging taxes through foreign accounts, including a plan to obtain U.S. taxpayer information through foreign governments.

One version of the model released Thursday would require the U.S. to exchange information about foreigners that it collects on accounts held in domestic financial institutions, the Treasury said.

The provisions developed alongside the U.K., France, Germany, Spain and Italy are essential to the U.S. enforcing the Foreign Account Tax Compliance Act, passed in 2010.

The so-called Fatca rules, require foreign financial institutions to start reporting detailed information about U.S. account holders to the Internal Revenue Service in coming years. If the firms don't comply, they could face U.S. tax penalties.

The negotiations among the six countries created two versions of the agreement. The "reciprocal version" includes a policy commitment for the U.S. to pursue regulations and legislation that would provide for equivalent levels of exchange as it demands from other countries. Treasury said that version will be available to certain governments, on a case-by-case basis.

Thursday's model agreement "is an important milestone in our joint efforts to combat offshore tax evasion and make our tax systems more efficient and fair," Treasury Secretary Tim Geithner said in statement.

Mr. Geithner said the model agreement allows Fatca to be implemented in a "targeted and effective" way.

Banks have expressed concerns about the burdens the law creates.

Both versions of the agreement, however, allow for foreign financial institutions to report the necessary information to their respective tax authorities, helping to avoid duplicative efforts. Then the information would be subject to exchange under existing bilateral tax treaties or similar deals.

Thursday's model builds upon a commitment made by the six countries in February, but could be followed by other countries as well. Last month, Treasury announced deals with Japan and Switzerland to allow banks in those countries to comply with law.

Write to Eric Morath at [email protected]

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news
Date Title
08:54p AFBF AMERICAN FARM BUREAU FEDERATION : Summer Cookout Prices Down Slightly
08:54p ANSELL : Encourages workers to redefine their comfort zone and introduces hyflex® 11-542 high cut protection glove
08:54p AMC : ORDERS FOURTH SEASON OF “BETTER CALL SAUL”
08:54p HEALTHSOUTH CORP : Unregistered Sale of Equity Securities (form 8-K)
08:54p DFA DAIRY FARMERS OF AMERICA : commits to sponsorship for the 2018 Accelerator Program
08:52p SUNRUN INC : Khang & Khang LLP Announces Securities Class Action Lawsuit against SunPower Corporation and Reminds Investors with Losses Over $100,000 to Contact the Firm
08:50p Google faces years of EU oversight on top of record antitrust fine
08:50p PETRO RIVER OIL CORP. : Other Events (form 8-K)
08:50p GOLDCORP : Announces Agreement with Exeter to Proceed with Subsequent Acquisition Transaction
08:50p National Interstate Insurance Company President and CEO Tony Mercurio Receives Smart 50 Award
Latest news
Advertisement
Hot News 
-8.85%ALLIED IRISH BANKS : Ireland could sell more AIB shares after oversubscribed IPO
-1.41%CROWN RESORTS : Casino Executive Sentenced -- WSJ
-8.42%Avis Gets Waymo Driverless Car Deal -- WSJ
5.50%Britain's Travis Perkins names ex-ARM man as chairman
3.53%BANKIA : Spain's Bankia buys BMN to create fourth-biggest lender
Most Read News
02:48aDJWARREN BUFFETT : Buffett Backs Store REIT -- WSJ
12:28p Oil prices up two percent on weaker dollar, short covering
12:41a CARLOS GHOSN : Nissan says CEO Ghosn's salary rose 2.5 percent last year
02:48aDJDANIEL LOEB : Nestlé and L'Oréal Have Long History, Too Long for Loeb -- WSJ
02:28aDJSTUART CHAMBERS : Travis Perkins Appoints Stuart Chambers as Chairman
Most recommended articles
02:50p Google faces years of EU oversight on top of record antitrust fine
02:45p SEARS CANADA : to delist from Nasdaq
02:42pDJBOND REPORT : Treasury Yields Get Lift As Draghi Comments Pressure European Bonds
02:31p ROYAL BANK OF CANADA : RBC to pay $16.5 million to clients as part of regulatory settlement
02:11pDJWhat a Sprint Deal With Comcast and Charter Would Mean for the Wireless Industry