Posted on 12/15/2011 5:10:16 AM PST by Cardhu
European banks are dumping clients with US citizenship due to a new American law meant to curb tax evasion. The law would require financial institutions around the world to report on certain client activities. Compliance, say many banks, is way too expensive.
The idea was to ensure that US citizens were paying their taxes on investments made through overseas banks. The result, however, has been that Americans in Europe may have difficulties finding banks who want their business.
According to a report in the Wednesday edition of the Financial Times Deutschland, several European banks have elected to no longer serve American securities investors due to stricter reporting requirements pushed through last year by the administration of President Obama.
German financial institution HypoVereinsbank has informed its customers that it will no longer offer certain services to its US-based clients or to US citizens as of Jan. 1. Deutsche Bank told the paper that it already cancelled such accounts held by American citizens in the middle of 2011. Germany's second largest bank, Commerzbank, is considering a similar move. Customers with normal checking or savings accounts in Germany are not affected, however.
British banking giant HSBC has also reported that it will no longer serve US investors...
The reason for the sudden reticence to serve American clients is the Foreign Account Tax Compliance Act (FATCA), which was passed in 2010 and will go into effect in January of 2013. The act requires all foreign banks to identify and report on US citizens with accounts holding more than $50,000 in an effort to clamp down on tax evasion. If banks refuse to comply, they could face a punitive 30 percent withholding tax on all payments from the US. The law is expected to increase tax revenues by $8 billion over the next 10 years.
(Excerpt) Read more at spiegel.de ...
Is this more Dodd/Frank?
Pray for America
When they finally build that border fence, it will have the barbed wire facing to keep Americans in.
And foreign banks would comply with nosy American regulations for what reason, I wonder?
What payments are they talking about?
So, it’s back to the tried and true. Go somewhere and establish a local corporation with bearer shares issued to you. Put the money in the corporation in the foreign bank and have them invest it however you desire.
“O” did SOMETHING to make it worth their while... I guess we’ll find out someday
The “O” administration is a crime in progress
I think they may be talking about withholding 30% of money transfer deposits from American citizens, as a 30% withholding is standardard income tax withholding for non-American citizens unless arrangements are are made with certain countries.
To get money from the Fed and the IMF.
How can we force other countries to abide by our banking laws? Why don’t they just tell the US to take a frickin’ hike.
This is utterly ridiculous.
I wouldn’t be surprised if sometime in the next five years or so, the US government makes it a felony to have any kind of bank account overseas.....even if you live there, or like me, are a permanent resident of an overseas country.
“And foreign banks would comply with nosy American regulations for what reason, I wonder?”
At a guess, reciprocal treaties requiring that specific types of laws are honored. I know there’s an agreement with every country on income taxes. If you’re a US citizen working almost anywhere you pay US taxes (which are a bargain.) Foreign nationals in the US are supposed to pay their country’s tax.
The government wants to know exactly where, and how much, money you have. Every home sale, stock sale, bank deposit, withdrawal, IRA and 401 transaction, paycheck, dividend check, internet sale or purchase, is being tracked. The government is already real good in knowing where it is all at. Just a few more loopholes to close.
Good question, even the Swiss rolled over
Fear of being accused of being racist to a black president?
Conversely when EU bankers seek IMF (read US taxpayer) bailouts to keep their banks afloat, we need a Congress that replies “take a hike”
Definitely a first step in that direction.
European banks are under no compulsion to open or maintain accounts from anyone -- treaties or not.
This is how your ‘free’ health care is paid for.
Live too long and cost too much you exceeded the max payout, goodbye house...
Just ask anyone related to an Alzheimer’s patient.
I have family and coworkers who are paying $1000.00 each month out of pocket. YES ONE THOUSAND DOLLARS!
Illegals are free.
Also in Illinois the illegals are too good for generic prescriptions, only the best!
IIRC it is a 7 year clawback on assets.
I wonder how big a deal this is?
Considering the current banking crisis in Europe, anybody with money stashed there is mentally defective.
Just ask Jon Corzine.
Corzine will have to do some quick shopping....
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