Jersey has signed an agreement to implement the US Foreign Account Tax Compliance Act (FATCA).
The agreement was signed by Jersey’s Chief Minister Senator Ian Gorst and by His Excellency Matthew Barzun, US Ambassador to the UK, in London on 13 December.
The move follows the signing in October of an intergovernmental agreement with the UK to exchange tax information on UK residents. In January, the States of Jersey will debate regulations which will allow Jersey institutions automatically to exchange information under the EU Savings Tax Directive, with the intention of automatic exchange becoming mandatory from January 2015.
The Jersey authorities have also committed to joining the OECD Multilateral Convention on Mutual Administrative Assistance in Tax Matters and confirmed Jersey’s willingness to actively participate in the OECD’s efforts to introduce a single global standard for automatic exchange of information.
Geoff Cook (pictured), chief executive of Jersey Finance, says: “The signing of this agreement gives Jersey’s finance industry, and its underlying clients, a great deal of added certainty in Jersey and its position in relation to tax compliance and reporting to the US. As well as clarifying that clients with US interests will not be liable for US withholding taxes, the agreement also reinforces Jersey’s existing business relationships with the US, with whom Jersey signed a Tax Information Exchange Agreement in 2002, and helps strengthen Jersey’s reputation in key overseas markets.
“More widely, the signing of this milestone agreement, together with the recent agreement with the UK and active participation in developing global standards of automatic exchange of information, provides further evidence of Jersey’s full commitment to the fight against tax evasion, and leaves no doubt of the key role Jersey continues to play in international initiatives to improve tax compliance and enhance transparency.”