The United States Department of the Treasury says it has signed intergovernmental agreements (IGAs) with Canada to halt offshore tax evasion in the Caribbean and other countries through implementation of the Foreign Account Tax Compliance Act (FATCA).
On Wednesday, the Treasury Department said similar agreements were signed earlier this week with Hungary, Italy and Mauritius.
The department noted that the US Congress enacted the FATCA in 2010 to “target non-compliance by US taxpayers using foreign accounts,” including those in the Caribbean.
“The provision has since become the global standard for promoting tax transparency,” said the statement, adding that the United States has signed 22 IGAs and “has 12 agreements in substance to date.”
“FATCA implementation is critical to combating international tax evasion and promoting transparency,” said Deputy Assistant Secretary for International Tax Affairs Robert B. Stack.
“The agreements announced today clearly demonstrate the considerable international support behind FATCA, and we are proud to lead the global charge on this pressing issue,” he added.
FATCA seeks to obtain information on accounts held by U.S. taxpayers in other countries. It requires US financial institutions to withhold a portion of certain payments made to foreign financial institutions (FFIs) that do not agree to identify and report information on US account holders.