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

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 eric.morath@dowjones.com

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
03:36p ELECTRONIC HEALTH RECORDS : Whose data?
03:36p Harris & Harris Group Notes Announcements by Its Portfolio Companies During the Third Quarter of 2016
03:35pDJCOGNIZANT TECHNOLOGY : Investigating Indian Payments
03:34p BARDA Awards $51.9 Million Contract to DNAe to Develop Semiconductor DNA Sequencing Platform for Rapid Diagnosis of Antimicrobial Resistant Infections and Influenza
03:34p United States Friedreich's Ataxia Market and Competitive Landscape Highlights 2016 - Research and Markets
03:33p Wall Street opens higher as financial stocks rise
03:33p EVONIK INDUSTRIES : breaks ground for expansion of its membrane production in Schörfling (Austria)
03:33p BELDEN : Why You Should Beware of Cheap Patch Cords
03:33p ZILLOW : 'Tiny House Nation' Host Talks About Being Happy With Less
03:33p BELDEN : 4 Ways Enterprises Benefit from the Multi-Tenant Data Center Ecosystem
Latest news
Advertisement
Hot News 
6.08%Savannah Resources 1st Half Net Loss Narrows; Extends JV Deadline
-2.93%H & M HENNES & MAURITZ : &M 3Q Net-Profit Falls 9% on Quarter
-2.86%COMMERZBANK : targets two million new customers while cutting staff
4.75%TULLOW OIL : Confirms Insurance Cover for Jubilee-Linked Business Loss
-1.73%RBS unveils brand changes, new structure in ring-fencing revamp
Most Read News
03:23a DEUTSCHE BANK : admits 'perception issue' as shares slide
09/29 NXP SEMICONDUCTORS EXPLORES SALE TO QUALCOMM : sources
07:30a Deutsche CEO tries to reassure staff as shares plunge
09/29 AIRBUS : to merge with its jetmaking unit - sources
09/29 Salesforce urges EU to probe Microsoft, Linkedin antitrust issues
Most recommended articles
09/26Predicting the U.S. Elections With The WMA Trump/Clinton Barometer
09:31a LUXOTTICA : says China head Ciarlariello has left
09:27a DEUTSCHE BANK BOND TRADING UP 15-FOLD IN A MONTH : Trax
09:26aDJCOGNIZANT TECHNOLOGY : Investigating Indian Payments
09:26aDJCheniere Energy to Acquire Holding Company