Washington – The Republican National Committee (RNC) on Friday called for the repeal of a U.S. anti-tax-evasion law, siding with big banks, libertarians and American expatriates that have criticized the Obama administration statute.
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At its winter meeting in Washington, the RNC approved by voice vote a resolution in favor of abolishing the 2010 Foreign Account Tax Compliance Act (FATCA), set to take effect in July, marking the party’s first explicit attack on the law.
FATCA will require most foreign banks and investment funds to report to the U.S. Internal Revenue Service information about U.S. customers’ accounts worth $50,000 or more. The law was enacted after a scandal involving Americans hiding assets in Swiss bank accounts to dodge U.S. taxes.
Critics have blasted the law as an unfair government overreach and invasion of financial privacy.
“The Republican National Committee … urges the U.S. Congress to repeal FATCA,” said the measure, staking out a campaign position ahead of 2014’s mid-term elections.
On Wednesday, with the RNC vote expected to occur, a senior Treasury Department official said the vote would not hurt the administration’s efforts to implement FATCA via a web of tax information-sharing agreements with other countries.
Tax watchdog groups that support FATCA slammed the Republican vote. “It is mind-boggling that a major political party would even consider endorsing a resolution to facilitate tax evasion,” said Heather Lowe, director of government affairs at anti-graft watchdog group Global Financial Integrity.
“Repealing the law would cripple the U.S. and global efforts to fight offshore tax evasion,” she said in a statement.
The Center for Freedom and Prosperity, a group that advocates for lower taxes and financial privacy, praised the RNC vote. “The GOP’s adoption of FATCA repeal to its platform is a major victory for taxpayer privacy rights,” said the center’s Director of Government Affairs Brian Garst.
Republican Senator Rand Paul last year introduced legislation to repeal parts of FATCA, citing privacy concerns.
Repeal is unlikely and the issue was not expected to resonate with average U.S. voters, said lobbyists on both ends of the political spectrum. But they said Republican opposition to the law could help the party raise campaign funds.
This repeal makes no sense, why should rich be able to hide their money well the average American doesn’t know or want to do it.
I don’t imagine this is about helping Americans break the law.
Banks would rather throw out Americans rather than risk millions of Dollars fighting the US Government. This is about the USA putting such terror in banks worldwide that if you speak English they will throw you out. The banks are afraid of trouble if an Israeli holding US citizenship opens an account.
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WHY? This isn’t about the rich it’s about all of us 7 million Americans legally living and working abroad who have unfortunately been born in the USA. Till now we have had to file double tax returns and sometimes pay taxes to 2 countries. Now with this new illegal insane FATCA we are being denied bank accounts, pension plans mortgages and even being told by our old banks to get our money and take it somewhere else. Is this fair? USA is the only country that taxes its citizens that are legally living and working abroad and do not benefit from their tax money. Imagine having to comply with 2 totally different tax laws running to 2 accountants and 2 deadlines then paying 2 taxes without getting anything in return. INSANITY!!!!!! and taxation without representation….
Enough is enough this is not about the billionaire living in the Caymans it’s about me and you and/or my kids and your kids…. The rich guy will always have tax lawyers etc to find him loopholes and the works.
Kudos to the republicans.
What more the IRS has the power to look into any American’s bank account worldwide. How long till they will have the power to peep into your bank account in the USA. Do you want them seeing every bank transaction you ever did??
Where is ACLU on this? Is it automatically legal just because it’s the democrats doing this?
The concept of the law is good but… it adds hours and hours of paperwork for pretty much any US citizen living abroad, or who visits other countries/has enough business – that they’ve set up a local (that is, in the foreign country) bank account to handle misc transactions.
– and the banks hate it, too.
The penalties are so horrendous that the only ones this helps are the lawyers and international tax accountants. Everyone else gets nothing but headaches.
Well to all of you out there I can just tell you imagine the Polish and Russian, Hungarian government all saying you ppl owe them years of back taxes cuz under their crazy laws you are a citizen and have to file and pay taxes and penalties in their countries. You never received a dime from them but have to pay illegal taxes then they start putting liens on your bank account and getting the bank info and suddenly your bank is kicking you out. Only because your great grandfather once lived there and under their laws you are a Polish citizen.
Just google “FATCA expat” and start reading the horror stories.