The Foreign Account Tax Compliance Act (FATCA) United States of America Implementation and Enforcement of the Inter-Governmental Agreement was passed in Parliament without opposition, making it mandatory for Antigua & Barbuda’s banks to provide the banking information of US citizens to the Internal Revenue Service (IRS), reports Antigua Observer.
The Act requires local banks to report financial accounts held by US taxpayers, for tax collection purposes, to the IRS, if they exceed $50,000.
Prime Minister Gaston Browne told Parliament the legislation is not beneficial to Antigua & Barbuda, but the country has agreed to comply.
“What seems to be happening is every time there is a meeting of the G20 leaders they drink their wine; they have fun and then they come up with these initiatives as to how they can stop the flow of capital from the respective countries, and almost invariably they look to countries in the Caribbean, even in most instance we don’t have a lot of deposits,” he said.
Browne said the agreement should have taken effect since 2014, but, there were some delays.
“The intergovernmental agreement between Antigua & Barbuda and the United States was not signed until a few months ago, and it was not as a result of any shortcoming on the part of our government, but the US government was very slow in completing the process,” Browne said.
FATCA was enacted in 2010 by Congress to target non-compliance by US taxpayers using foreign accounts. FATCA requires foreign financial institutions (FFIs) to report to the IRS information about financial accounts held by US taxpayers, or by foreign entities in which US taxpayers hold a substantial ownership interest.
It seeks to combat tax evasion by US citizens holding investments in accounts outside the US.