Business
U.S. issues “final” FATCA regulations on Caribbean and other offshore tax havens
The move will have far reaching implications and may adversely affect the growth of the financial centers in the Caribbean.
The United States Department of the Treasury and the Internal Revenue Service (IRS) have issued what they describe as “comprehensive final regulations to combat Caribbean and other offshore tax evasion.”
The departments said the reporting and withholding tax provisions, commonly known as the Foreign Account Tax Compliance Act (FATCA), “target non-compliance” by US taxpayers using foreign accounts.
“The issuance of the final regulations” marks a key step in establishing a common intergovernmental approach to combating tax evasion.
“These regulations provide additional certainty for financial institutions and government counterparts by finalizing the step-by-step process for US account identification, information reporting, and withholding requirements for foreign financial institutions, other foreign entities, and US withholding agents,” the statement said.
Deputy Secretary of the Treasury Department, Neal Wolin, said the regulations “give the administration a powerful set of tools to combat offshore tax evasion effectively and efficiently.”
“The final rules mark a critical milestone in international cooperation on these issues, and they provide important clarity for foreign and US financial institutions,” he added.
The Treasury Department said the final regulations “build on intergovernmental agreements that foster international cooperation”.
