Advancing a US crackdown on tax evasion by Americans, the US Department of the Treasury said on Thursday that Switzerland and the US have signed a pact to make Swiss banks disclose more information about US account holders.
The agreement is the latest in a series designed to carry out the Foreign Account Tax Compliance Act, or FATCA, enacted in 2010.
The law requires foreign financial institutions to tell the US Internal Revenue Service (IRS) about Americans’ offshore accounts worth more than US$50,000.
FATCA was enacted after a Swiss banking scandal showed US taxpayers hid millions of dollars overseas.
The pact announced on Thursday, known as an intergovernmental agreement (IGA), needs to be ratified by the Swiss parliament. It does not need approval by the US Senate.
The deal has been close to completion since December last year.
FATCA imposes steep penalties beginning next year on financial institutions that do not comply with the law. Banks and other financial institutions failing to comply could be frozen out of US financial markets.
“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,” US acting Secretary of the Treasury Neal Wolin said in a statement.
The Swiss Bankers Association said it welcomed the FATCA deal, but remains critical of the compliance and administrative burdens of the US law.
In signing the pact, Switzerland joins the UK, Denmark, Ireland and Mexico as countries that have finished FATCA IGAs with the US.
The US Treasury has pursued two different IGA models.
The Swiss deal is the first “model two” agreement signed. It will require Swiss financial institutions to provide US account holder information directly to the IRS.
The four other IGAs concluded so far are “model one” agreements, which allow financial institutions to comply with FATCA by channeling US account-holder information through their national tax authorities to the IRS.
Unlike some other pacts, the Swiss deal is not reciprocal, meaning the IRS will not provide Switzerland with information about Swiss citizens’ accounts in US banks.
The pact excludes Swiss social security, pension funds and some insurers from FATCA.
The US Treasury is working with more than 50 countries on deals, but negotiations have not progressed with key trading partners Canada and China.
Micron Technology Inc has suspended plans for a memory chip plant in Taiwan due to a protracted labor dispute, according to people familiar with the matter, throwing into question the fate of a major production base for crucial artificial intelligence (AI) components. The US company has all but halted construction of a plant in Taoyuan, said the people, who asked not to be identified because the deliberations are private. Executives are concerned about mounting uncertainties, including the risk that an agreement with a local labor union will get overturned. Micron has informed Taiwanese officials and a supplier about its plans to
Bank SinoPac Co (永豐銀行) yesterday said it had found no evidence of customer data being leaked in 427 unauthorized transactions involving 419 customer accounts the previous day. The transactions resulted from hackers breaching security settings at suppliers of the bank’s new mobile banking system, the bank told a news conference held to announce the findings of its investigation. The incident involved 427 transactions, each of which transferred about NT$100,000 (US$3,050) from Bank SinoPac accounts to a single account at another bank, for a total of approximately NT$41.76 million. The receiving account was temporarily frozen, a Financial Supervisory Commission official said on Tuesday. Bank SinoPac
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is considering broadening its business to include advanced memorychip manufacturing, The Information reported on Friday, a move that would give the world’s largest chipmaker an even bigger share of the artificial intelligence (AI) hardware supply chain. TSMC began drafting plans to produce a particular type of advanced memory chips, known as 3D DRAM, at the request of Nvidia Corp, its biggest customer, The Information reported, citing two people familiar with the plans. The company is also exploring acquiring a plant and converting it for memory production, the report said. The push is helmed by Hsu Kuo-chin (徐國晉),
A global race to build artificial intelligence (AI) infrastructure is unleashing billions of dollars of investment in advanced chip packaging, a once unglamorous aspect of technology that has become a critical bottleneck in turning out the world’s most powerful processors. As demand for AI chips outstrips available packaging capacity, companies from Nvidia Corp and Advanced Micro Devices Inc (AMD) to lesser-known players in Taiwan are expanding production, while equipment makers develop new tools, interviews with more than a dozen industry executives and analysts show. "Packaging was always that thing that you just didn’t worry about," former Intel Corp chief executive officer Pat
RSS