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07th-Feb-2014

Canada, Hungary sign US anti-tax evasion pacts

By AFP, Washington

The United States signed anti- tax fraud pacts with Canada and Hungary this week, expanding its drive to combat offshore tax evasion, the Treasury Department said Wednesday.
The Treasury also said it had earlier signed agreements with Italy and Mauritius, bringing to 22 the total number of pacts to implement the Foreign Account Tax Compliance Act (FATCA).
The 2010 law requires foreign banks and other financial institutions to report information about accounts held by US taxpayers to the US tax agency, the
The law also applies to foreign companies that are substantially owned by US taxpayers.
Under FATCA, US financial institutions must withhold a portion of certain payments made to foreign financial institutions that do not agree to identify and report information on US account holders.
Robert Stack, the Treasury's deputy assistant secretary for international tax affairs, said the act was crucial to fighting international tax evasion and promoting transparency.
"The agreements announced today clearly demonstrate the considerable international support behind FATCA and we are proud to lead the global charge on this pressing issue," Stack said.
Britain, France, Germany and Switzerland, as well as tax havens such as British territories Jersey, Guernsey and the Isle of Man, are among the 22 who have entered reporting agreements with the United States.
The Treasury said it has agreements for a dozen more pacts that have not yet been signed.