Contacted on the issue, former president of the Bankers’ Association of T&T Nigel Baptiste said they were aware of the IRS notice. However, he said the IRS statement did not make it clear that effective start-up date of the policy would be January 1, 2017.
“What the announcement indicated was that the IRS would begin a process of evaluating which territories were still considered to have an IGA in effect on January 1, 2017. All territories were required to advise the IRS before that date why they had failed to put the IGA into force by September 30, 2016, and indicate their plan and timeframe for doing so,” Baptiste said in an emailed response to the T&T Guardian.
“The IRS would then adjudicate and declare a territory still compliant or not. If not, two months notice would be given to the financial institutions to arrange the process of directly submitting to the IRS. As I indicated at the press conference (last week), this process places our fate in the hands of the IRS.
“When we consider that the US ambassador has already indicated that he cannot understand our failure to implement the legislation, this fate becomes even more tenuous. Additionally, our correspondent banks, who are the ones required to withhold the 30 per cent on all US source inflows and who have been raising queries already, will have to decide whether they await the outcome of the IRS' deliberations or act earlier.
“Their risks re: operational errors resulting in huge US fines is high. It is for these reasons that BATT remained/remains of the view that we must do everything in our power to have control over our destiny.”
Asked whether the BATT was aware that Government had signed the IGA on September 16 and whether financial institutions were obligated to provide financial information about US citizens to the IRS, Baptiste said this did not make T&T FATCA complaint.
“The signing of the IGA does not bring it into force. It only comes into force when the enabling legislation is enacted. Our enabling legislation is the Tax Information Exchange Agreements Bill. As such financial institutions are not yet obligated or able to comply with the requirement to provide the information.”
ABOUT FATCA
FATCA was enacted in 2010 by the US Congress to target non-compliance by US taxpayers using foreign accounts.
It requires foreign financial institutions (FFIs) to report to the IRS information about financial accounts held by US taxpayers, or by foreign entities in which US taxpayers hold a substantial ownership interest.