Official Swiss Federal Press Release (English Version)
RTS article (in French): Un accord fiscal a été conclu entre la Suisse et les Etats-Unis
Translation of RTS article:
A Tax Agreement has been concluded between Switzerland and the United States.
An agreement has been concluded between Switzerland and the United States on the application of American tax law. The agreement would permit the taxation of the accounts of Americans abroad, but under certain conditions.
The United States and Switzerland have signed Monday an accord about the application of the American tax law known as FATCA. The President of the Confederation Eveline Widmer-Schlumpf announced so Tuesday before the Swiss Senate.
The agreement must still be approved by the Federal Parliament, said the Secretary of State for International Financial Questions on Tuesday. It will be also submitted to an optional referendum as a matter of international treaty.
The text of the agreement will not be published until it is signed, the Secretary of State for International Financial Questions stated while communicating the message of the President. President Widmer-Schlumpf hopes for an entry in force of the agreement in early 2014, and made the information public during the morning, the Senate was the first to know.
Tax Accounts Abroad
The American tax law would permit Washington to tax all the accounts held abroad by persons subject to taxation in the United States. The “Foreign Account Tax Compliance Act” (FATCA) obliges banks and insurance companies to sign an agreement with the American tax authority in which they engage themselves to reveal all the accounts held by Americans. If they fail to do so, such financial institutions must pay a 30% withholding or no longer accept American clients.
Negotiated Exceptions
The Federal Council [Cabinet] preferred the option of a FATCA application with simplifications to be stated in an agreement.
In June, the United States and Switzerland already decided upon the gist of a common declaration. According to the declaration, social insurance, pension funds, and property insurance will not be subject to FATCA.
Swiss banks will be authorized to conclude an agreement with American tax authorities in order to respect the engagements in matter of data transfer about American accounts. But they will not be required to reveal by name those American clients who refuse to cooperate or to close their account.
Rapid administrative assistance will nevertheless be accorded for grouped requests concerning supplementary data about the accounts of non-cooperative American clients.
The number and the total amount of these accounts will be transmitted by the banks directly to the United States tax authorities. Switzerland diverges in this way from the model proposed by 5 large EU nations (Germany, France, Italie, Spain, United Kingdom) who rely on data transfer via a central governmental database.
Just tweeted by the Swiss Banking association..
https://twitter.com/SwissBankingSBA/status/298359129142083585
SwissBanking @SwissBankingSBA
Access to US market is important for Swiss banks; we expect quick signing and ratification of #FATCA agreement #sbastatement
*Gotta love the filing fees for being an American sucker in Switzerland, here’s one example:
@swisspinoy Reads like a menu at a gourmet restaurant. Unfair that one would have to hire professional help to be US compliant, where in Switzerland, most Cantons provide FREE tax software that helps you do it yourself.
*Jefferson D. Tomas, the IRS actually created a cool and friendly web portal which would have made it easier for Americans to file their taxes free of charge. But, as I understand it, the tax preparers got all upset and lobbied that such would harm their business. In response, the congress made the IRS scratch its cost-free friendly portal in favor of tax preparers. I really hope that you will be able to renounce US citizenship soon!
@SwissPinoy “tax preparers got all upset and lobbied that such would harm their business”. Can we argue collusion? Looks very much like the sort of collusion that existed in the 3rd reich. If you are a member of the IRS party, we will give you contracts and preserve your oppourtunity to make a buck. Violation of the free market. Could be a trade issue, no?
Let us persevere:
[Or you’ll be a Woman, my sisters and daughters–JDT]
Thanks, Jefferson.
The wisdom in that diversion is indeed applicable to this, our US Person Abroad absurd reality. Hold on.
*According to a poll in Bilan magazine tomorrow 54% of Swiss people are against losing banking secrecy. Wonder if that will have any effect on whether the IGA gets signed or not. Here’s some details from the bluewin.ch site:
http://www.bluewin.ch/fr/index.php/136,753069/Les_Suisses_refusent_un_nouvel_affaiblissement_du_secret_bancaire/fr/news/suisse/sda/
German to English Google Translate:
‘Green light for FATCA Agreement’
@Just Me Thanks for that, the machine translation is a bit odd, but the gist is there: Schlumpf is announcing an impending signature of an IGA. The Parliament and the People still do not know the détails (reminds me of the agreement signed in 2009 about the 5000 names from the UBS: the détails were kept secret for months and nobody knew if only the 5000 rich people would be affected or also the myriad of people with consumer banking accounts over 10k bearing microscopic interest yields). The Swiss People’s Party (SVP / UDC) are against the IGA, and probably against FATCA in general, but I think they still haven’t fully woken up to the menace it poses. Interesting that the article suggests other countries other than USA will want parity!
I wonder about enforceablility if this IGA is indeed only and merely a “Competant Authority” agreement and not an executive agreement or treaty from the US perspective (see Allison Christians, FATCA Forum video). Again, this sort of thing should be subject to a mandatory referendum Art 140 et seq CFS because its enforcement would require the Swiss Federal Constitution to be modified.
But Schlumpf and the pussy Federal Council are just barging ahead like a bunch of blind idiots with wet towels over their heads and fluff in their ears. This is treason! I know I might sound like a broken record, but it is a fact. Where is the President? (Ueli Maurer, Minister of Defense on the Federal Council who is SVP/UDC by the way). Dammitall Mister Maurer, put the Gripen fighter plane dossier down for a minute and pay attention to the shit that is happening that is probably the greatest menace to Swiss sovereignty and since World War II. If the members of the Federal Council outvoted you on this, you had a duty to leak the détails of this proposed IGA to Parliament, and let Parliament leak it to the People if they deemed neccesary so that the People may start collecting signatures against it. You are Defense Minister for crying out loud! Asleep on your Watch!!!??? Dust in the barrel of your FASS90, and bald eagle birdshit on your helment??? What a shame! Clean it out, clean it off!
Now is the time for all Swiss Brockers to go into outrage mode and push back!!! Get everyone in Switzerland involved as this IGA would eventually expose everyone, compliant or not, to violation of data protection and identity theft, let alone the risk it poses to enable illegal enforcement of unconstitutional double taxation policies that violate human rights. Give them an inch, they’ll take a mile, give them this IGA mile and they’ll have our lunch and more and we will be hard pressed to get their tentacles out of us. Even Swiss citizens who have nothing to do with the US would ultimately be affected. Switzerland, like Canada, is one of the front lines in this struggle. TO ARMS, CITIZENS! Work the phones, keyboards, pens, microphones, cameras. Move and go speak to people. The 2nd American Revolution is beginning. Let us cut off Mr. FATBARDT before he gets too far.
I was furthermore surprised to find that this was not yet front page news on the Francophone news sites in Switzerland. I would hope that I will be able to find something on it in French later today. When I do, I will post it here, and probably create a new thread, but in the meantime I will go skiing.
Widmer-Schlumpf, you are a traitor. Welcome again to the IBS Hall of Shame.
Dammitall why isn’t this front page news in francophone CH, all we are hearing about is fucking horsemeat in lasagne: http://www.rts.ch/info/monde/4661842-la-france-sanctionne-spanghero-dans-le-scandale-des-lasagnes.html
I think this is conspiracy. Some dickheads think that if they don’t publish the story in French, I won’t pick up on it. I’ve got news for you, mates. I READ GERMAN. BRING IT ON!
Hot off the Treasury web site..
Treasury, Switzerland Sign Bilateral Agreement to Improve Tax Compliance, Combat International Tax Evasion and Implement FATCA
2/14/2013
WASHINGTON – The U.S. Department of the Treasury announced today that it has signed a bilateral agreement with Switzerland to facilitate the implementation of the information reporting and withholding tax provisions commonly known as the Foreign Account Tax Compliance Act (FATCA).
“Today’s announcement marks a significant step forward in our efforts to work collaboratively to combat offshore tax evasion,” said Acting Secretary of the Treasury Neal S. Wolin. “We are pleased that Switzerland has signed a bilateral agreement with us, and we look forward to quickly concluding agreements based on this model with other jurisdictions.”
Enacted by Congress in 2010, FATCA targets non-compliance by U.S. taxpayers using foreign accounts. The bilateral agreement signed today is the first based on the model published in November of 2012 – the second of two model agreements – and marks another important step in establishing a common approach to combatting tax evasion.
Switzerland is one of eight countries that have signed or initialed an intergovernmental agreement (IGA) which helps to facilitate the effective and efficient implementation of FATCA. In addition to the previously announced countries, Treasury initialed an IGA with Italy on January 24. Treasury is engaged with more than 50 countries and jurisdictions to curtail offshore tax evasion, and more signed agreements are expected to follow in the near future.
On January 17, 2013, the Treasury Department and the IRS finalized the regulations implementing FATCA, providing additional certainty for financial institutions and government counterparts about the process for U.S. account identification, information reporting, and withholding requirements for foreign financial institutions (FFIs), other foreign entities, and U.S. withholding agents.
Updates and further information on FATCA can be found by visiting the Treasury FATCA page at http://www.treasury.gov/resource-center/tax-policy/treaties/Pages/FATCA.aspx
The agreement can be found at http://www.treasury.gov/resource-center/tax-policy/treaties/Documents/FATCA-Agreement-Switzerland-2-14-2013.pdf
There’s a Reuters story on this already in the Globe:
The most interesting part is near the end where it says they’re not doing very well with China and Canada. I’d hate to get my hopes up, but maybe Flaherty is going to keep his backbone intact.
I posted the link to that Globe piece — but it didn’t show up. I’ll try again here:
http://www.theglobeandmail.com/report-on-business/international-business/european-business/switzerland-agrees-to-tell-irs-about-us-citizens-offshore-accounts/article8690509/
Thanks Arrow. I just made a headline post of this news.
@Jefferson D Tomas
Horse meat is important, as that is what FATCA will turn you into, just like I was almost turned to fish fertilizer in the OVDP LOL
@Arrow, this also appeared today in the Globe Business section.
Putting this here, but can be moved to another thread if more logical. Just bringing attention to it.
Small notice type section in ‘On the Web’ section in Globe and Mail today:
Look up this site http://www.lexpert.ca/Globe/ and then look for author Cline, “US Regs Spur Banking Tax Agreement
by Bev Cline
‘New regulations under the Foreign Account Tax Compliance Act (FATCA) in the United States have cast a cloud of uncertainty over Canadian financial institutions and their US clients.’
……”……..Canada and the US are in negotiations, with an eye to creating a Model 1 Intergovernmental Agreement (IGA). Under this bilateral agreement, Canadian financial institutions would report the information required under FATCA to the Canadian government (rather than to the IRS), which would then exchange this information with the IRS for similar information that the IRS may be expected to collect about Canadian accounts held in the US. “….
“There are a number of other issues that general counsel will need to take into consideration, says Crosbie (Ian Crosbie, a partner in the tax group of Davies Ward Phillips & Vineberg LLP in Toronto). For example, “the privacy considerations almost certainly will be different under the IGA because the information is being collected under the requirements of Canadian law. Where this is not the case, a wide range of privacy issues need to be considered.”…..
“….”Even though there’s uncertainty around FATCA compliance, Gartner says that one certainty is inescapable: the information will need to be collected. So, if they’re not already doing so, “general counsel and their law departments need to work with their compliance, tax and operations teams to assess current processes and procedures, and retool their technology to be in compliance, regardless of the eventual channel through which it is reported.”
A resistance is futile post. Online only. No place to comment.
And, with NO discussion of the potential conflicts with the Charter, or the Constitution, or problems with entering into an agreement that would potentially ruin the > 1 million duals/US persons in Canada. NO discussion of the previous statements by Flaherty about Canada not being a tax haven. NO discussion of the problem with FATCA being a treaty for Canada and an executive agreement for the US. NO discussion of the ‘faux’ reciprocation, or the already glaring flaws in the existing Canada-US tax treaty.
As to the IRS version of the text: “(24) The term “Account Holder” means the person listed or identified as the holder of a Financial Account by the Financial Institution that maintains the account. A person, other than a Financial Institution, holding a Financial Account for the benefit or account of another person as agent, custodian, nominee, signatory, investment advisor, or intermediary, is not treated as holding the account for purposes of this Agreement, and such other person is treated as holding the account.”
What the heck does this mean? It sounds like if somebody has power of attorney over their wife’s account, for example, they are not a holder for purposes of the Agreement. But what does “…such other person is treated as holding the account..” mean? I don’t understand. What doofus wrote this?
RTS radio piece on the IGA (in French): http://www.rts.ch/audio/la-1ere/programmes/forum/4638197-fatca-la-suisse-a-t-elle-bien-negocie-14-02-2013.html
The Democrats Abroad guy says that current accounts (compare to consumer banking checking accounts, and should also apply to savings) are exempted if they are less than USD 50k. And that people refused accounts should be able to get them again under such condition (I am thinking about the lady in Armenia or somewhere who was losing her account at the BCV she needed for drawing her disability pension). He says that most Americans in Switzerland have less than 50k in such accounts (of course we will have to read the agreement to see if the promised exemptions for pension plans are included as Schlumpf announced since last summer). He sounds happy about this IGA saying that it should reduce costs for the banks, and that Switzerland was able to negotiate some flexibility, and that this had to due with the fact that the complaints of the American community abroad were heard and addressed. Well, thank you Mr. Democrat Abroad. But what we want is an entire repeal of the whole FATBARDT regime. You haven’t heard the last of us, Buddy.
Even if this is a better deal for Switzerland, it is still a deal where there should be NO DEAL. Switzerland should tell the US to cram it where the sun don’t shine. NO FATCA, NO FBAR, NO DOUBLE TAXATION.
Sorry, the woman was living in Georgia (not the state, the country): https://isaacbrocksociety.ca/2012/11/28/another-victim-of-fatca-retired-swissamerican-woman-living-in-ex-soviet-georgia/
As to http://www.treasury.gov/resource-center/tax-policy/treaties/Documents/FATCA-Agreement-Switzerland-2-14-2013.pdf
“(26) The term “U.S. Person” means a U.S. citizen or resident individual, a partnership or corporation organized in the United States or under the laws of the United States or any State thereof”
There is no defintion about dual nationality, so we could argue RS291 Art 23.
This is Treason!! Article 4, enabling clause: Financial Institutions that, pursuant to applicable U.S. Treasury Regulations, enter into an FFI Agreement with the IRS or register with the IRS as deemed-compliant FFIs, are authorized and therefore not liable to any penalty according to Article 271 of the Swiss Criminal Code.
The Federal Council has no authority to do this. I do not see the term “emergency act” anywhere. Only parliament can do this and only within the restrictions of the constitution. Only the people can override the constitution by modifying it in a popular vote resulting in a majority of the cantons and of the electorate at large. Even if it were an emergency act, it would only be temporary and parliament and/or the people could accept or block it.
Eveline Widmer-Schlumpf, du feindling, versager! Traitor!!!! Wimp!!!!
However, I don’t see any mention of Art 261bis, Swiss Federal Criminal Code (as to anti-discrimination).
Why Switzerland is switching from a Model 2 IGA to a Model 1:
http://www.deblislaw.com/wp-content/uploads/2015/01/JTPP_16-05_DeBlis.pdf?utm_source=Copy+of+February+2015+Newsletter&utm_campaign=MJD&utm_medium=email