Treasury advises that the Foreign Account Tax Compliance Act (FATCA) was enacted by the United States (US) Congress in March 2010. It is intended to assist US efforts to improve compliance with US tax laws and will impose certain due diligence and reporting obligations on foreign (non-US) financial institutions.
In response to concerns about the impact of these obligations on Australian financial institutions and the Australian economy as a whole, the Government is exploring the feasibility of an intergovernmental agreement with the US. The objective of such an agreement would be to minimise compliance costs for Australian stakeholders while enhancing the existing tax cooperation arrangements between Australia and the US.
Written submissions are invited on the advantages and disadvantages of an intergovernmental agreement (IGA) between Australia and the US, based on the published US Model IGA, as an alternative to individual agreements between Australian financial institutions and the US Internal Revenue Service.
The closing date for submissions is Friday 28 September 2012.
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