Business
Push in Jamaica for urgent discussion of new US tax law – FATCA
“What is a sovereign state? These are things that we need to debate here,” said Earl Jarrett, the general manager of Jamaica National Building Society (JNBS), at yesterday’s Observer Monday Exchange at the newspaper’s headquarters on Beechwood Avenue, Kingston.
Local financial institutions argue the new compliance rules will, among other things, come with burdensome implementation costs and an outflow of funds from the formal banking system.
Implementation costs of FATCA are expected to run from US$100,000 to upwards of US$1 million. The implementation period is 2013 to 2017, but financial institutions are required to sign on to the agreement by June next year.
“There will be a heavy burden on local financial institutions. The due diligence that we will have to do on all our customer accounts,” said Courtney Campbell, the CEO of GraceKennedy Financial Group, who also spoke at yesterday’s Observer Monday Exchange.
“These institutions must now begin to plan how to comply with the FATCA requirements,” Campbell said. “The big issue is to understand who is a ‘US person’ as defined by the act.”
A “US person” under FATCA is defined as someone having US citizenship, a US green card, a US birthplace, a US residence address or US correspondence address, a US passport, among other things.
“We do not have this information on our customers now,” Campbell said.
