Russian President Vladimir Putin has signed a law to allow Russian financial institutions to provide information about US taxpayers and to oblige foreign financial institutions to report Russian taxpayers to Russia’s Federal Tax Service. The document has been posted on the government website of legal information.
Starting July 1, 2014, the Foreign Account Tax Compliance Act (FATCA) will require foreign financial institutions (FFIs) to provide annual reports to the Internal Revenue Service (IRS) on the name and address of each US client, as well as the largest account balance for the year and total debits and credits of any account owned by a US citizen or person (Green Car holder).
If an institution does not comply, the US will impose a 30% withholding tax on all of its transactions, including investment revenue.
To be able to comply with FATCA requirements, banks and other financial institutions need to register with the IRS.
Editor’s Note: This is it. With China and Russia now on board with FATCA it has now become a fait accompli. And once FATCA has been consolidated expect GATCA to follow soon after.