2 comments on “New Countries On FATCA: India & UAE… What This Means For You!

  • The unforeseen consequences from this increased vigilance by the US tax authorities and other countries hoping for reciprocal cooperation to bring their tax evaders into tax compliance will be felt increasingly in the years to come I am sure.

    Claiming that FATCA has resulted in negative “unforseen consequences” is just as commonplace as the claim that it’s intended goals are “noble” or such like. This is laughable. I see no reason to give the US/Treasury and IRS the benefit of the doubt on this. It would imply stupidity on their part on a truly grand scale. No, they knew very well exactly what the consequences of this disaster would be, and have very well earned the contempt felt by “US persons” around the world.

  • The IRS and the Treasury are just enforcing laws on the books since a long time, dating back to the Kennedy era. For a while, enforcement was lax, and it was even hard to find out how to be compliant — the IRS certainly didn’t know when one asked them.

    The contempt of US persons should be directed at Congress, who due to typical Congressional paralysis don’t seem to be able to fix even this simple issue. FATCA makes good sense for a US-based person who only would use a foreign account for tax evasion.

    It does not make sense for US persons resident abroad. Such people contribute only marginally to taxes collected each year, yet the bureaucracy incurred in making such people compliant is expensive for the IRS, the US person, and now for the FFIs with which such people must do business. US banks are simply not equipped to do business abroad.

    So Congress should have switched to residence-based taxation years ago. Republicans have made this a party plank, but failed to act on it so far. One strong proponent of repealing FATCA was Rand Paul, but he seems now to be off on a quixotic quest for a flat-tax in order to propel himself to the head of the Republican pack running for the GOP presidential nomunee.

    So much ‘policy’ made by Congress is more consistent with re-election and career advancement, but not with good government, it’s sickening.

    This problem is where the disgust of US persons, both those abroad and homelanders, should be directed.

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