The Republican protest to repeal the Foreign Account Tax Compliance Act (FATCA) is spreading worldwide with the launch of a protest petition on social media.
FATCA is a global tax information swapping agreement between the United States government to clamp down on US taxpayers with cash and investments overseas.
The law, backed by Democrat President Barak Obama, demands foreign financial institutions report the details of bank accounts and investments of US taxpayers to the Internal Revenue Service (IRS) to ensure the right amount of tax is paid on earnings and capital gains.
FATCA has sparked controversy worldwide.
US taxpayers are angry that their overseas financial affairs are now exposed to the IRS, while many governments see the law as an intrusion into their internal affairs.
FATCA progress
Nevertheless, FATCA comes into force from July 1and foreign financial institutions and US taxpayers who ignore the rules face hefty penalties.
Republicans Overseas, a lobby group set up to represent the rights of US expats is inviting taxpayers to download a petition against the law to sign and return to Washington.
A copy can be downloaded from the group’s Facebook site.
On the site, the Republicans argue FATCA is forcing many US expats to renounce their citizenship.
Meanwhile, the list of countries signing up to FATCA is growing, with Slovenia the latest to ink a deal with the US.
They join many countries with leading financial centres, including Britain, France, Japan, Spain, Italy and several former tax shelters like Jersey, Guernsey, the Isle of Man and The Cayman Islands.
OECD tax crack down
Other countries, including Russia and China, have pledged to join the network but have yet to finalise agreements with the US government. Both Russia and China indicated they would sign up to FATCA by the end of January, but have yet to do so.
In another bid to short-circuit FATCA, a leading Republican, Senator Solomon Yue, who forced through a resolution before the party’s executives to repeal the law, has written to the ambassadors of the G20 group of leading developed economies.
The letter explains why the Republicans are backing the anti-FATCA resolution and petition.
In another move by the US and developed nations to crack down on tax avoidance, the Organisation of Economic Co-Operation and Development (OECD) is expected to announce new moves to stop multinational corporations saving tax by shifting their revenues between low tax financial centres.
The action will introduce statutory country-by-country reporting of revenues by multinationals, with the aim of making the corporations pay tax on revenues in the nations where they are earned.
I would be curious to know why my comment was removed. It has appeared in more than half a dozen other blogs and MSM news sites.