We originally posted U.S. Engaging with More than 50 Jurisdictions to Curtail Offshore Tax Evasion on November 8, 2012, where we discussed that the U.S. Department of the Treasury announced that it is engaged with more than 50 countries and jurisdictions around the world to improve international tax compliance and implement the information reporting and withholding tax provisions commonly known as the Foreign Account Tax Compliance Act (FATCA).
Luxembourg is one of the largest financial centers, which is built upon bank secrecy laws. As such, it has come under intense pressure from the EU and the US, in their global effort to crack down on tax evasion.
Luxembourg has now chosen the Model I FATCA
Agreement, which provides for an automatic exchange of information between the
Luxembourg and American fiscal authorities on bank accounts held in Luxembourg
by citizens and residents of the United States.
This decision will put Luxembourg’s
relations with the US in line with the declaration of 10 April 2013, by which
Luxembourg announced that it will introduce, on 1 January 2015 and within the
scope of the 2003 EU Savings Directive, the automatic exchange of information
within the European Union.
Luxembourg wishes to see the same conditions apply to all competing financial centers and to see the automatic exchange of information accepted as the international standard.
It has therefore agreed on May 14, 2013 to grant the European Commission a mandate to negotiate with Switzerland, Liechtenstein, Andorra, Monaco and San Marino.
Do Have Unreported Income From a Luxembourg Bank?
Secret Foreign Investments Keeping You Awake at Night?
Want to get right with the IRS?
Contact the Tax Lawyers at
Marini & Associates, P.A.