A legislative committee approved a proposal yesterday to ask eight state-owned banking institutions to abide by Taiwanese law and refuse to provide the US with information on its citizens.
Legislators said the banks must not violate the Personal Information Protection Act (個人資料保護法) by working with US authorities when a law aimed at combating offshore tax evasion is passed in the US.
They also urged the Financial Supervisory Commission and the Ministry of Finance to sign a tax agreement with the US soon.
Chinese Nationalist Party (KMT) lawmakers Lai Shyh-bao (賴士葆), Lu Shiow-yen (盧秀燕) and Alex Fai (費鴻泰), and Democratic Progressive Party Legislator Hsueh Ling (薛凌), who are on the legislature’s Finance Committee, said their proposal was designed to defend national sovereignty.
Under the US’ Foreign Account Tax Compliance Act, foreign financial institutions are required to sign an agreement with the US Internal Revenue Service to provide information on financial accounts held by US account holders.
“The US law, to be enforced in 2014, will turn Taiwan’s 39 banks into tools of a US crackdown on tax evasion,” Hsueh said.
She urged the central government to instead discuss the establishment of a tax information exchange mechanism or a tax agreement with Washington.
“The state-run banks should take the lead and not cooperate with the US act,” Lu said.
A day earlier, the Bankers Association of the Republic of China (銀行公會) said it was studying how other countries might act in response to the new US law.
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