Annual reports designed to avert tax evasion
The United States and Macau have agreed to monitor bank accounts held by Americans in the Chinese territory.
The agreement was made in compliance with the U.S. Foreign Account Tax Compliance Act, established by the U.S. Internal Revenue Service to “combat tax evasion by U.S. persons holding accounts and other financial assets offshore,” according to the IRS website.
Under the terms of the deal, “financial institutions operating in Macau need to register and enter into individual agreements with the IRS and obtain the consent of the account-holders who are U.S. taxpayers for the purpose of providing information about these accounts on an annual basis.”
The measure is “aimed at specific American taxpayers, including U.S. citizens, U.S. residents and certain entities established in the United States of America or controlled by American people,” reported Macau Business.
The agreement was signed by Macau Secretary for Economy and Finance Leong Vai Tac and the Consul General of the United States to Hong Kong and Macau Kurt Tong.
The IRS notes that reporting institutions will include not only banks but also other financial institutions such as “investment entities, brokers and certain insurance companies. Some non-financial foreign entities will also have to report certain of their U.S. owners.”
