A bill to correct the unintended effects of the US ‘Foreign Account Tax Compliance Act’ (FATCA) could be forthcoming, the European Parliament’s Committee on Petitions (PETI) told EUROPE in a statement on Tuesday, 30 August.
A delegation from the PETI Committee went on a mission to Washington from Monday 18 to Friday 22 July to find concrete solutions to the problems of the many EU citizens and their family members affected by the extraterritorial application of the citizenship tax.
In their meeting with the Chairman of the Joint Committee on Taxation, Richard Neal, as well as Congressmen Lloyd Doggett and Eric Swalwell, MEPs were presented with a letter to Treasury Secretary Janet Yellen highlighting the need to fix FATCA.
FATCA currently includes within its scope the vast majority of legal and actual European residents with US citizenship or dual citizenship as well as ‘accidental Americans’, who were born in the US but have no other connection with the country.
The delegation also discussed the idea of having tax attachés in US embassies in European countries to reduce the risk of fraud and to channel communication between the US authorities and citizens to help them comply with the law.
MEPs also stressed that in the exchange of information mandated by FATCA, there is no reciprocity with the EU and that, although intergovernmental agreements with EU countries to implement FATCA are exempt from the obligation to comply with the General Data Protection Regulation, they clearly run counter to its purpose. The amount of data transferred is indeed not proportional. (Original version in French by Anne Damiani)