Banks and other financial institutions around the world want to become US tax agents.
The abbreviation FATCA is increasingly found in the Russian media. So shortly called the American law, the full name of which: Foreign Account Tax Compliance Act. In translation: "On the taxation of foreign accounts."
FATCA as a construction tool Pax Americana
The law was signed by the US president still 18 March 2010 of the year. Then began its phased entry into force. Next year it should go into action in full. It belongs to the new generation of American laws, which can be called extraterritorial. These are laws that apply to a number of other countries, and sometimes the whole world. These are laws that help Washington build Pax Americana.
The FATCA law was adopted on the pretext that the US treasury regularly loses large sums of taxes withheld by individuals and legal entities of the United States, withdrawing its income and assets from US jurisdiction. The American tax system is designed in such a way that individuals and legal entities of the United States must pay taxes regardless of where they receive their income or place assets. Only from the departure of US citizens and companies in offshore, according to some estimates, the US federal budget loses about 100 billion dollars annually. And how much he receives from citizens and US companies in other jurisdictions, no one thought. For many years and even decades, Washington tried to fight tax dodgers located outside the country, but the effect was low.
The law of FATCA, in the opinion of its initiators, must put an end to such deviationists once and for all. How? But simply by making banks and some other financial organizations of all countries of the world agents of the American Tax Service (IRS - Internal Revenue Service). Financial and banking organizations must transfer to the US tax authorities information about their clients who are of American origin or have business (commercial) connections with individuals and legal entities of the United States. The list of clients, by the way, includes people who are holders of an American green card. If necessary, such agents should even deal with the collection of taxes from such clients in favor of the United States.
We are witnessing the building of a unique global system, the “head” of which is the US department, and all financial and banking organizations of formally sovereign states are coming under the administrative control of this department. Those who refuse to invite Uncle Sam to become part of this system automatically turn out to be “outcasts”. Washington will apply sanctions in the form of withholding 30% of money that such organizations will spend through the US banking system against such financial and banking organizations. And since the modern global financial and banking system is based on dollars, it is difficult to imagine a bank that would not carry out dollar transactions. All such transactions pass through correspondent accounts opened by non-US banks at US banks. It seems that the struggle of Washington with tax deviationists is only a pretext for the adoption of the law. The main, non-advertised goal of FATCA is to build a global financial system, the individual “cells” of which would not only economically but also administratively report to official Washington and that financial oligarchy that serves the formal power of the United States.
World reaction to FATCA
So, next year all non-US banks should begin practical work on evaluating and identifying customers that fall under the definition of “American taxpayers”, and at the end of the year (according to other sources, in March 2015) to submit the first reports to the IRS. Accordingly, Washington’s sanctions against non-US banks evading the honorary duty of a “US tax agent” may begin to be applied in a little over a year.
It is not difficult to imagine what reaction throughout the world caused the law. First of all, among US citizens. The delivery of American passports has begun, American nationals do not want to be under the “cap” of the IRS. Several million Americans live permanently outside the United States, it is they who first of all will renounce their US citizenship.
No longer have to talk about the reaction of non-US banks and financial organizations. State leaders and politicians in several countries grumbled and grumbled, calling the law a manifestation of "American colonialism", but began to be built at the command of Uncle Sam.
Moreover, Washington made certain concessions. He offered other countries a two-step system: non-US banks provide information about American taxpayers not directly to the IRS, but to their national tax authorities. And those, in turn, are already sending it to Washington. To this end, Washington was asked to sign the relevant bilateral intergovernmental agreements between the United States and other countries on the implementation of FATCA. Around 50 states expressed willingness to sign such agreements. Such countries as the United Kingdom, Denmark, Hungary, Germany, Ireland, Japan, Mexico, Norway, Spain, Switzerland were quick to sign agreements. Recently, the media reported that six more agreements were signed - with Malta, the Netherlands, Bermuda and the three dependent territories of the United Kingdom (Jersey, Guernsey, Maine). Thus, at the end of this year, the number of bilateral intergovernmental agreements on FATCA reached 18. Banks of those countries that do not sign intergovernmental agreements should go into the "direct subordination" of the American Tax Service.
Russia's reaction to FATCA
And how did Russia react to the FATCA law? At first (2-3 a year ago), the reaction was sharply negative. In particular, the Russian Foreign Ministry described the law as an attempt by Washington to impose its dictates on other countries of the world. Then, in 2012, there was a period of complete silence. As if our authorities did not notice the FATCA law, they did not take any measures. Only occasionally, our officials made comments that if Russia began to comply with the conditions of FATCA, it would be in contradiction with Russian legislation. In particular, FATCA contradicts the Russian regulations on banking secrecy and the Civil Code of the Russian Federation in terms of the breakdown of contractual relations (the case if a Russian bank closes the account of the American tax diversionist). Some Russian banks were nervous, knowing what position they would be in if Russia did not sign a bilateral agreement with the United States. Then, without much publicity, the agencies “from above” were given the command to prepare their proposals for amending Russian legislation in order to bring it in line with the new conditions created by FATCA.
It was only in 2013 that some kind of “stirring” appeared, which was periodically supported by statements by Finance Minister A. Siluanov that Russia was preparing a bilateral agreement on FATCA. Nobody remembers our angry statements of two or three years ago.
Siluanov promised in the spring that, they say, before the end of the year the agreement will be signed. Already the end of the year, it has not been signed yet. What should banks do? The new chairman of the Bank of Russia, E. Nabiullina, recently stated that banks could not prepare for the fulfillment of FATCA requirements before 2016. But Washington is inexorable, declares that it is not going to give any delays. By the way, it's not just about time, but also about money. Back in 2012, the National Payment Council Non-Profit Partnership conducted a survey of 36 Russian commercial banks in order to find out how they are preparing for FATCA implementation and what their capital and current costs associated with such implementation may be. Only initial expenses for the purchase of software, training of specialists, creation of a methodical base should be at least 1 million dollars per bank. That is, on the scale of our entire banking system, this is about 1 billion dollars. This delicate question is bypassed. By default, this is the cost of Russian banks. And for good it would have to be the cost of the one who brewed all this “porridge”. Those. costs would have to be paid by the US tax authorities. But, by the way, all this is trivial against the background of the problems that may arise with Russian banks after the law of the IRS comes into full effect. After all, even a bilateral agreement with Washington is not a guarantee against possible sanctions. The object of sanctions can be our state (if the IRS considers that the tax service of the Russian Federation is not vigorously fulfilling the requirements of the agreement and the law). The object of the sanctions can be a single Russian bank. Let us recall how in the middle of the last decade, Washington ordered the closing of correspondent accounts of many Russian banks in American banks only because of “suspicions” of money laundering and the financing of terrorism. I do not exclude that if the American legislators came up with the idea of legalizing the Magnitsky list, then over time in America there may also appear a black list of Russian banks violating FATCA.
About Russia, FATCA and our "elite"
However, there is a way out of any unpleasant situation. This way out of the situation called “FATCA” was from the very beginning in Russia. Let me remind you that Washington, within the framework of a bilateral intergovernmental agreement, offers two basic options. Conventionally, they can be called "asymmetric" and "symmetric" versions of the agreement. The first assumes that a foreign state undertakes unilateral obligations to fulfill the conditions dictated by the American FATCA law. The second option assumes that both contracting parties undertake to provide the necessary information to the other party of a tax nature relating to the legal and natural persons of its state. In the second variant, the foreign state preserves its face and solves its fiscal problems by identifying its tax dodgers in the United States.
The preparation of an agreement with the United States by our Ministry of Finance over the course of several months was conducted in complete secrecy. Unofficial sources claim that both options were discussed. Finally, in October, our media reported that the Russian Ministry of Finance was preparing a very radical agreement, which even differs from the “symmetrical version proposed by Washington. The document is called an intergovernmental agreement on the exchange of information of a tax nature. There is no mention of the American FATCA law at all; the agreement looks like a mutually beneficial agreement of two sovereign and equal states. This one would only be happy.
But about a month ago (November 28), Russian Prime Minister D.А. Medvedev was listening to the question of preparing an agreement. The prime minister instructed the Ministry of Finance and the Central Bank to “speed up” and prepare an agreement for January 20 on 2014. This is normal. Troubling another. Many media outlets disseminated the following information: “For the first time, Medvedev publicly supported the agreement and even mentioned FATCA, he instructed to prepare a draft agreement“ on the implementation of the provisions of the US law ”. Some commentators did not notice anything. In their opinion, they say, this is a play on words, the essence of the agreement does not change. I'm afraid that's not the case. It is precisely because “above” cannot agree on which option to choose (“symmetrical” or “asymmetrical”), so long is the preparation of the agreement. Translated into clear language, the words of Medvedev can be interpreted as follows: prepare an “asymmetrical” version.
To whom it is profitable, I think it is understandable. America for many of our kleptomania (oligarchs and bureaucrats) was for a long time a “promised land”. They hide innumerable riches, stolen during the years of the so-called "reforms". Naturally, they are not declared and are not taken into account anywhere. However, some estimates are available. The most famous of them belongs to the "friend" of Russia Zbigniew Brzezinski. This is an American politician, talking to our scientists about the missile defense issue, noted that “he doesn’t see a single case in which Russia could use its nuclear potential while there are 500 billion dollars belonging to the Russian elite in American banks. - And then he added: you still have to figure out whose elite is yours or is already ours. This elite does not bind their fate with the fate of Russia. They have money there, children are already there .... ”.
Approximately three weeks are left until the mentioned deadline for the completion of the preparation of the agreement. So soon we will find out how Russia is going to build its relations with Uncle Sam in the context of FATCA. This agreement will be a very accurate indicator showing which elite are high-ranking officials of our government.