Through the controversial Foreign Account Tax Compliance Act, the U.S. will seek to compel foreign financial institutions to report to the Internal Revenue Service information about overseas accounts held by American taxpayers. Although FATCA has not yet gone into effect, its anticipated results were the subject of a conference, "FATCA from a U.S. and E.U. Perspective: Where Are We Now?" at NYU School of Law on June 21.
The event, co-sponsored by NYU Law and the Amsterdam Centre for Tax Law, gathered a host of international tax experts. The first of the conference’s two panels, on the subject of U.S. policy developments related to FATCA, included five participants, all of whom had served in the U.S. Treasury Department’s Office of International Tax Counsel. Their collective experience in that office began in 1977 and extends without interruption to the present. The day’s second panel focused on FATCA’s implications for European Union institutions and featured speakers with expertise in that area.
On the morning of the event, conference co-chair H. David Rosenbloom, James S. Eustice Visiting Professor of Taxation and director of the International Tax Program at NYU Law as well as former international tax counsel in the Treasury Department, sat down for a podcast interview (below) with Atticus Gannaway, senior writer for the Law School magazine. The conversation focused on the policy ramifications of FATCA, which has raised questions about sovereignty and the cost of enforcement regarding what the act asks foreign entities to do on behalf of the IRS to hold Americans abroad accountable for taxes on their holdings in offshore accounts. Lack of reporting on those funds costs the U.S. government untold millions every year.
“There’s no doubt that FATCA is probably as broad an extension of U.S. jurisdiction as I’ve seen in my lifetime, and it basically is addressed to the entire world,” said Rosenbloom. “There are a lot of reasons to have problems with FATCA, but from my perspective the people who object to FATCA have an obligation to realize that FATCA was designed to address a given problem that really existed. If they don’t like FATCA—and I understand fully why they don’t like FATCA—my view is that they ought to be thinking about a reasonable alternative, a less intrusive alternative, and they don’t seem willing to do that.”
Watch the video of the first panel (2 hr, 4 min):