Taiwan could benefit from US delay in FATCA implementation: official
January 19, 2014, 12:05 am TWN
TAIPEI, Taiwan -- A possible delay in the United States' implementation of a tax information exchange with financial institutions across the world could help Taiwan gain leverage in the follow-up negotiations, local finance officials said yesterday.
While Taiwan is preparing to sign a pact with the U.S. to help local financial institutions meet tax-reporting requirements under Washington's 2010 Foreign Account Tax Compliance Act (FATCA), it is likely that the implementation of the act would be postponed, the officials said.
Originally scheduled to take effect on July 1, the FATCA could be delayed for six months, according to the officials.
The delay may result from the many pending Intergovernmental Agreements (IGAs) between the U.S. and other countries, through which financial institutions will report information on U.S. account holders to avoid offshore tax evasion, according to the officials.
The U.S. still has a lot of paperwork to complete, they said, adding that Taiwan could use the extra time to negotiate better deals.
Still, it is hoped that Taiwan could sign the agreement with the U.S. by March, they added.
The officials noted that April 25 remains the deadline for local financial institutions to register with the Internal Revenue Service (IRS) to ensure inclusion on the list of Foreign Financial Institutions.