Tomorrow, Members of the European Parliament will vote on a resolution on the extraterritorial impact of the US Foreign Account Tax Compliance Act (FATCA) – an American law requiring foreign banks and financial institutions to report to the American tax authorities on customers who are “US Persons”, i.e. US citizens or people with ties to the US, or pay a 30% withholding tax.
Due to this law, many “accidental Americans”, who, by accident of birth, inherited US citizenship, but who do not maintain any ties to the US and are EU citizens, face problems with banks or financial institutions. Banks for example are refusing US persons as customer, so these EU citizens no longer have access to financial services like a basic bank account, mortgage loans or credit for their business.
Denouncing US citizenship is expensive and cumbersome. EU member states are facilitating FATCA by transferring personal data of US persons to the US tax authorities. Internet platforms like AirBnB or Tripadvisor as well, are passing on personal data to the US tax authorities for the purpose of identifying possible US persons.
Sophie in ‘t Veld, the ALDE Group First Vice President, said today:
“We support the fight against tax evasion, but in Europe more than 110.000 innocent people are unfairly targeted by FATCA and they cannot live a normal life like anyone else. Citizenship Based Taxation is an unfair and unreasonable system that is only applied by two countries in the world: the US and Eritrea.”
“The Commission should put citizens’ rights before diplomatic relations, and demand that the US find a solution and end the predicament of US persons in Europe. In addition, the Commission must ensure that in Europe no one is excluded from essential financial services on the basis of their nationality. Moreover, any sharing of data with the US authorities must comply with EU data protection standards.”
#FATCA: “Citizenship Based Taxation is an unfair and unreasonable system that is only applied by two countries in the world: the US and Eritrea. The EU must protect its citizens from this US taxation overreach.” says @SophieintVeld. Read more here: https://t.co/swMu9dP0eF pic.twitter.com/WXtZiweue7
— ALDE Group (@ALDEgroup) July 4, 2018
Cecilia Wikström, Chair of the Committee on Petitions, added:
“I welcome that the resolution calls on the Commission to take action to ensure that EU fundamental rights and values, such as the right to privacy, the principle of non-discrimination and EU data protection rules, are respected in the context of FATCA and the automatic exchange of information with the US.”
“I therefore urge the Commission and the Council to present a joint EU approach to FATCA, and open negotiations with the US on an EU-US FATCA agreement. We can only deliver a strong deal that protect our citizens’ rights and interests by approaching the US collectively.”
Source: ALDE
