Guyana, USA sign tax evasion agreement

Guyana and the United States yesterday formally committed to the fight against offshore tax evasion with the signing of an agreement to implement the Foreign Account Tax Compliance Act (FATCA). Minister of Finance, Winston Jordan and US Ambassador to Guyana, Perry Holloway were the signatories.

The ceremony took place at the Boardroom of the Ministry of Finance, in the presence of the Commissioner-General of the Guyana Revenue Authority (GRA) Godfrey Statia. FATCA, which was enacted in 2010 by the US Congress, is designed to prevent tax fraud and evasion by US taxpayers using offshore banking facilities. It creates a new regime of automatic tax information sharing between financial institutions. The Act also requests foreign financial institutions to identify and report information about accounts held by US taxpayers in their jurisdictions. Furthermore, FACTA is part of a global movement towards Automatic Exchange of Information (AEIO) of non-resident financial account data among tax authorities. AEIO has the potential to increase transparency, cooperation and accountability among financial institutions, and encourage tax payers to voluntarily disclose all relevant information to tax authorities. In his address to the media, Ambassador Holloway said that Guyana and the US have been working together on the agreement for the past two years and in many ways, is formalizing what has been going on all along. The diplomat asserted that the United States welcomes Guyana’s movements towards ensuring international tax compliance. He said that the agreement is a symbol of both countries’ commitment to work collaboratively towards combating offshore tax evasion; an objective which he said will have mutual benefits. Finance Minister Winston Jordan agreed with the sentiments shared by Holloway, adding that the event is a significant and historic one for Guyana. Jordan said that the signing of the agreement to implement the Foreign Account Tax Compliance Act represents both the culmination of a long travelled road and the beginning of a new phase in the Guyana/United States cooperation in tax and anti-money laundering matters.

Jordan said that Guyana chose to be involved in this important venture not only because it will help to reduce tax evasion in the United States, but also, in Guyana, through the exchange of information between the two countries. To fulfill the potential of FATCA to be a potent weapon in the fight against tax evasion and avoidance, the Finance Minister said that Guyana would be required to undertake a number of measures to improve and strengthen its legislative and institutional arrangements. “Thus, for example, Guyana amended Section 63 of the Financial Institutions Act, Laws of Guyana, to designate the Guyana Revenue Authority as the competent Authority, on behalf of the Government of Guyana. This will allow Financial Institutions to provide the GRA with customer information on reportable accounts,” the economist said. The Finance Minister said that the sharing of information across countries is important for the enforcement of domestic tax laws.

(Kaieteurnews.com)