United States citizens will be watched even more after the agreement signed between the United States and Switzerland The government of the United States will multiply tax pressures on its citizens, after arriving at an agreement with Switzerland for pursuing tax evaders. In a joint announcement, officials from the two countries assured that they work together to ensure the effectiveness and efficiency in correctly implementing the Foreign Account Tax Compliancy Act, known as FATCA.
This law became effective in 2010, with the objective of exposing United States citizens who conceal assets. This legal mechanism needs, essentially, that all foreign financial institutions cooperate with the Internal Revenue Service (IRS), or they could face a fine on income obtained in the United States.
The fiscal agreement between the United States and Switzerland stipulates that the Swiss banks will transfer its American clients’ data directly to the IRS, but in such a way that it “doesn’t violate the spirit of the bank law in effect in the Helvetian country.” The data received by the IRS will be combined with others from other nations, where they have also signed a fiscal agreement with the United States and Switzerland, to have a more complete profile for the North American contributor.
The new agreement is one more attempt by the United States for avoiding tax evasion. In February 2012, the White House reached a similar agreement with the German, French, Italian, Spanish and British governments. In these cases, the European banks will share the information of American clients with their own governments and then they (the governments) will pass the information to the United States.
The FATCA continues to arouse polemics, between private attorneys and the financial industry, which argues that as a result of the law it will lose billions of dollars and reduce businessmen’s interest in investing in the United States. The North Americans who live abroad are also worried because the law will complicate their business in their new countries of residence.
Experts feel that the understanding between the United States and Switzerland was influenced by the decision by the Department of Justice to pursue 11 Swiss banks for false suspicions that it was helping Americans to evade taxes.
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