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Russia’s duma adopts law to allow FATCA disclosures
Zone(s): Russia, USA ¦ Sector(s): Taxation
[24 June 2014, Tax-News.com] By Mike Godfrey, Tax-News.com, Washington: The lower house of Russia’s legislature, the State Duma, has approved a bill to enable financial institutions to comply with the United States’ Foreign Account Tax Compliance Act. (FATCA). Enacted by the US Congress in 2010, FATCA, which will take effect from July 1, 2014, is intended to ensure that US authorities obtain information on accounts provided by foreign financial institutions (FFIs) to US persons.
Failure by an FFI to disclose information about their US clients will result in a requirement to withhold 30 percent tax on payments of US-sourced income. The bill, which was passed by the State Duma at first reading, allows Russian banks to transfer information about their customers to foreign tax authorities. It also requires banks based overseas to provide information on their Russian account holders to the Russian Federal Tax Service.