How does the us crack down on offshore tax avoidance

下面为大家整理一篇优秀的assignment代写范文- How does the us crack down on offshore tax avoidance，供大家参考学习，这篇论文讨论了美国如何打击海外避税。美国为了打击公民和绿卡持有者的离岸逃税行为，推出了《海外账户纳税法案》。根据《海外账户纳税法案》规定，所有的美国居民和外国金融机构必须向美国国税局报告其相关账户信息，不合作的个人以及金融机构将会受到严厉惩罚。《海外账户纳税法案》的签署意味着无论是美国公民或者美国企业，还是与美国毫无关联的外国金融机构，都将受到该法案的约束。

A new system of disclosure and withholding tax, the tax on overseas accounts act, came into effect on July 1, 2014. The federal crackdown on offshore tax avoidance by us citizens is in high gear.

The U.S. foreign account tax bill was introduced to combat offshore tax evasion by U.S. citizens and green-card holders. Under the tax on foreign accounts act, all U.S. residents and foreign financial institutions are required to report information about their accounts to the irs, and uncooperative individuals and financial institutions will be severely punished.

In recent years, the U.S. government has increased its efforts to crack down on offshore tax evasion. In fact, in order to prevent American citizens from abusing offshore tax evasion, as early as March 2010, US President barack Obama signed the overseas account tax bill submitted by the irs. The signing of the foreign account tax bill means that it will apply to all U.S. citizens, permanent residents, U.S. businesses, and foreign financial institutions with no ties to the United States. But the bill has been controversial since it was signed and has been held up by many disgruntled voices.

In late December 2011, the irs released some details of FATCA. On February 20, 2014, the Treasury Department's department of energy and the internal revenue service launched two programs. The first package includes changes to the internal revenue code, commonly known as chapter 4 of the tax on foreign accounts act. The second set of rules stipulates that FATCA coordinates filing and withholding tax payment standards.

Under the act, U.S. citizens or green-card holders who travel to and from the United States for more than 183 days over a three-year period meet the threshold of eligibility if their personal accounts exceed $50,000 or their corporate bank accounts exceed $250,000 and their policy cash value exceeds $140,000. U.S. citizens and green-card holders are required to file information about these overseas assets with the irs, and those who do not file are deemed to have knowingly evaded taxes. Foreign financial institutions, including Banks, investment funds and insurance companies, are required to declare overseas accounts held by U.S. taxpayers who exceed $50,000. FATCA requires financial institutions to use due diligence procedures to determine who among the Americans has invested in non-u.s. entities. At the same time, the bill requires all foreign Banks or other financial institutions that wish to operate in the United States to provide information about the accounts of U.S. citizens. Foreign institutions that are not registered with the us government and fail to disclose or disclose such information are subject to a 30 per cent withholding tax. "Once implemented, this punishment will not so much freeze their activities in the U.S. financial market as impose a death sentence on these financial institutions," one comment said.

According to the report, important employees of American multinational companies are often assigned to work in different countries and join local retirement plans. Now the United States has extended its tax code to these retirement plans, requiring non-u.s. retirement plans owned by U.S. citizens or residents who work in other countries to also pay taxes under the U.S. tax code. The intent of the FATCA act is clear. The aim is to stem the growing trend of Americans hiding their income and assets abroad over the years. An estimated 7.6 million U.S. citizens now live overseas, and millions of other green-card holders are subject to U.S. tax laws. Currently, however, only a few hundred thousand people file required tax forms or statements each year.

It is understood that FATCA will clean up many offshore tax evaders who do not file their tax returns as required. In a statement on offshore tax avoidance, irs commissioner Scott koskinen said Americans living overseas will not be fined as long as they make up the taxes they owe. But they must prove that they did not intentionally owe taxes. Overseas account holders living in the United States pay a penalty equal to 5 percent of their overseas account balances.

To avoid paying taxes, many are giving up their citizenship altogether. According to the statistics, 1,001 people have given up their citizenship and green CARDS in the first three months of this year. According to this trend, the total number of people this year will surpass last year's 2,999, which is a record high.

Recently, the irs has issued a series of new information. There is no doubt that the fcpa will make life more complicated and costly for U.S. taxpayers with financial ties overseas, affecting everything from investments to retirement savings and even divorce settlements.

Tax havens are quietly changing

The tax on foreign accounts act, aimed at cracking down on U.S. citizens' stash of assets and income abroad, is a major U.S. effort to track tax evaders around the world, and comes amid a number of scandals in which U.S. citizens have used offshore accounts to evade taxes. Moreover, part of the reason for the law is that the U.S. government is raising taxes to reduce the deficit. It is estimated that the United States loses about $100 billion a year due to overseas tax avoidance. Media comments said the law would make it more difficult for U.S. taxpayers to hide assets through offshore accounts or shell companies to make up for federal tax revenue. Congress expects the new bill to generate between $800 million and $10 billion in revenue over the next eight to 10 years if it fully compels Americans to fight offshore tax avoidance.

Switzerland, along with Austria, Luxembourg, Liechtenstein and other countries, is known as a European tax haven. Its tradition of bank secrecy and regulations facilitate criminal activities such as tax evasion and money laundering while attracting large amounts of foreign deposits. To prevent international tax evasion, the U.S. government is in the process of signing information exchange agreements with these governments under FATCA. Switzerland's private banking sector has borne the brunt of the us crackdown on offshore tax evasion. Switzerland is known to be the world's largest offshore financial centre, with $2.2tn under management.

Industry insiders believe Switzerland's proud tradition of private banking secrecy, which threatens to crumble in the face of us tax authorities, is quietly changing. In recent years, the United States and the European Union have stepped up pressure on Switzerland to abandon its tradition of private banking secrecy and implement an automatic exchange of bank information. Under pressure from the us, Switzerland last year reached an intergovernmental agreement with the us to share tax information. The Swiss federal commission said in a statement that it had implemented the U.S. tax on offshore accounts act on June 30, a move that will help Swiss financial institutions provide U.S. tax authorities with the banking information of U.S. citizens with Swiss bank accounts. "Switzerland, which has avoided countless wars over the past 200 years, has finally been blown to the ground by a financial sniping," commented one media source. "Switzerland, the world's largest offshore financial centre and tax haven for the wealthy, has raised the white flag in the face of a concerted campaign by the us and the European Union, and in the face of the need since the financial crisis to recover taxes and balance spending."

About 77,000 foreign Banks, investment funds and other financial institutions have agreed to comply with FATCA and register with the U.S. government to report U.S. citizens' account information, according to information released by the U.S. Treasury Department in early June.

According to the format of the agreement, the United States shall provide FATCA partner with the name, address and taxpayer identification number of the account holder for the account held by FATCA partner's resident in a U.S. financial institution; Accounts. The name and identification code of the relevant financial institution; The total amount of interest in a savings account; The total amount of dividends that the account receives from the United States; The total amount of other income derived from the United States and in compliance with the U.S. tax code. Of course, FATCA partners should provide similar information to the United States on the premise of reciprocity.

Thirty-six countries, including Germany, Britain and Japan, have signed formal intergovernmental agreements with the United States on the bill. Between April and June, 50 countries and regions, including India, Brazil, China, Hong Kong and Taiwan, initialled the agreement with the United States. Also on board was Russia, where President vladimir putin signed a decree a day before FATCA took effect, allowing Russian Banks to provide the U.S. government with information about U.S. taxpayers.

American Treasury Department said yesterday that China was on the list of countries that have "basically reached an agreement" with FATCA, starting on June 26, 2014. Under the agreement, China will provide the U.S. government with information about the financial accounts of U.S. citizens, and the U.S. will provide information about the accounts of Chinese citizens to the Chinese government. Under the model terms of the agreement, the accounts opened by Chinese residents at us financial institutions, their earnings and even the names and addresses of those who open them will be made transparent to the Chinese government.

In China, some corrupt officials often leave money in the custody of foreigners or immigrate relatives to ensure the safety of the money they receive from corruption. A formal FATCA agreement between America and China would be "very dangerous" for those who want to hide money in America's banking system. Top officials of the state administration of taxation have repeatedly stressed that China must strengthen international cooperation in taxation and strengthen the exchange of international tax evasion information to combat cross-border tax evasion.

Although FATCA has the suspicion of "overlord clause", since China will sign the bill in the form of bilateral reciprocity with the United States, the Chinese government can thus master the overseas account information of Chinese residents and realize information sharing. In this way, it is not only a direct benefit to China's tax revenue, but also an indirect help to China's anti-corruption drive.

"It may inadvertently give the Chinese government a new anti-corruption tool." "China could reap a windfall from its anti-corruption drive." Some media pointed out that. Because corrupt officials are also likely to receive untaxed income from bribes, enforcing the tax code is often accompanied by pursuing corruption.

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