FATCA to come into force in 2015
(CS) The Foreign Account Tax Compliance Act, more commonly known as FATCA, will be submitted to a vote at the Luxembourg parliament this autumn, before coming into force next year, Finance Minister Pierre Gramegna has revealed.
In answer to a parliamentary question by CSV MP Laurent Mosar, Gramegna said that the first automatic exchange of information between the US and Luxembourg is expected to take place before September 2015 and will relay data of the 2014 financial year.
Aimed at increasing tax transparency and combatting tax avoidance or fraud, information held by financial institutions in Luxembourg about accounts by US citizens will be shared automatically.
The minister added that several financial institutions in Luxembourg already have mechanisms in place to be able to comply with FATCA, with all financial institutions in the Grand Duchy obliged to be ready to exchange information when the agreement comes into force.
Additionally, with other EU directives on savings taxes and administrative cooperation requiring similar tools, Gramegna said that Luxembourg’s fiscal administration has already acquired “solid experience in matters of automatic exchange.”
Projections on FATCA’s impact on the banking sector, especially private banking, meanwhile do not exist at this point in time, the minister explained.
