By Staff writer
Ministry of Finance announces compliance with US FATCA law on tax evasion
The UAE’s Ministry of Finance (MoF) has begun establishing committees to start collecting tax data on any US citizen living in the UAE from 2017, it has announced.
The moves are required under the Foreign Account Tax Compliance Act (FATCA), a US federal law that aims to combat offshore tax evasion by US persons.
The ministry will coordinate with various government authorities to collect financial data in order to exchange information with US authorities for tax purposes from 2018, WAM said quoting a ministry statement.
The UAE joined the Global Forum on Transparency and Exchange of Information for Tax Purposes in 2010, with its cabinet approving the ministry’s membership to the G20 and Organisation for Economic Cooperation and Development (OECD) committees.
The UAE also holds a seat on the International Steering Committee for the exchange of tax information - the first Arab country to be elected to this position.
Finance minister Obaid Humaid Al Tayer was quoted in WAM as saying the UAE was dedicated to establishing the legal framework required to meet the standards of the OECD committees for the purposes of complying with FATCA.
It comes in line with the UAE cabinet’s authorisation for the MoF to sign and negotiate the agreement on mutual administrative assistance in tax matters, required by the G20, and a multilateral competent authority agreement in accordance with the common reporting standard.
The ministry is also working to sign memoranda of understanding with relevant authorities to oblige financial institutions to submit reports enabling the ministry to begin collecting data by 2017, and then activate the exchange of information for tax purposes in 2018.
So far, 94 countries have committed to implement the joint disclosure system by 2017 and 2018 under G20 directives.