Center for Freedom and Prosperity
For Immediate Release
Wednesday, August 1, 2012
CF&P Applauds Senate Scrutiny of Destructive FATCA Law and New Tax Information Sharing Agreement
(Washington, D.C., Wednesday, August 1, 2012) Four US Senators are demanding details from Treasury Secretary Timothy Geithner regarding a recent plan to impose significant financial burdens on US institutions in exchange for international compliance with the burdensome FATCA (Foreign Account Tax Compliance Act) law. The letter from Senators Rand Paul (R-KY), Jim DeMint (R-SC), Mike Lee (R-UT), and Saxby Chambliss (R-GA) questions Secretary Geithner over a new plan to enter into an agreement with five European nations committed to automatic exchange of tax information.
In addition to pointing out the odd lack of identifying information accompanying the initial Joint Statement by Treasury and the five European partner countries, such as the name of the authors, the letter echoes several key arguments long offered by the Center for Freedom and Prosperity, including: 1) A lack of clear Congressional authority to engage in this sort of broad policymaking at the agency level; 2) The absence of any evidence that Treasury has weighed the costs and benefits relating to FATCA and similar regulations; 3) The threat to privacy and human rights, and the potential misuse of personal data posed by new reporting rules, including by a recently adopted IRS regulation requiring the domestic reporting of interest paid to nonresident alien accounts; and, 4) The disturbing role played by the OECD in developing domestic tax policy.
Link to the letter: http://freedomandprosperity.org/files/fatca/4SenFATCAltr%2007-25-2012.pdf
Andrew Quinlan, President of the Center for Freedom and Prosperity, said of the agreement, “The letter shows a welcome understanding by the Senators of the benefits of tax competition and financial privacy, as well as the threat posed to its practice by overzealous bureaucrats.” He concluded, “The new multinational agreement is a brainchild of the OECD and just more of the same scorched earth approach to tax policy that CF&P has long fought. It demonstrates once again why the US needs to cut funding to the Paris-based bureaucracy. ”
CF&P’s Director of Government Affairs, Brian Garst, added, “The automatic exchange of information has long been the holy grail for the OECD and high-tax nations intent on preventing the legal flight of capital in response to bad tax policies. Enactment of this agreement will only encourage higher taxes and further cripple the global economy.”
CF&P’s mission is to educate the public and members of Congress on the benefits of tax competition, financial privacy and fiscal sovereignty, including the dangers posed by the OECD and how passage of laws like FATCA represent a misguided foray into fiscal imperialism that will backfire and drive investment out of the US economy.
For more information on FATCA visit http://freedomandprosperity.org/issues/foreign-account-tax-compliance-act/
For more information on the OECD visit http://freedomandprosperity.org/issues/oecd-pro-tax-international-bureaucracy/
For more information on the IRS regulation visit http://freedomandprosperity.org/issues/irs-information-sharing-regulation/