Ukrainian government approves bill ratifying FATCA
The Cabinet of Ministers has approved a bill to ratify the Agreement between the governments of Ukraine and the United States to improve tax compliance and application of provisions of the U.S. Foreign Account Tax Compliance Act (FATCA) and related bills, the Ukrainian Finance Ministry’s press service reported.
“On September 6, the Cabinet of Ministers endorsed a bill to ratify the Agreement between the governments of Ukraine and the United States to improve tax compliance and application of the provisions of the U.S. law on the Foreign Account Tax Compliance Act (FATCA) and related bills. The intergovernmental agreement to improve the application of tax rules and provisions of the Foreign Account Tax Compliance Act (FATCA) was signed by Ukraine and the United States on February 7, 2017. To implement and regulate the procedure of compliance of Ukraine’s financial institutions with FATCA, amendments to the Ukrainian legislation were developed, in particular, to the Tax Code and the Law ‘On Banks and Banking Activity’ and ‘On the depository system of Ukraine,” reads the report.
These amendments to the Ukrainian legislation will allow information to be exchanged not only under FATCA, but also other international treaties containing provisions for the exchange of information for tax purposes, the consent of which is provided by the Verkhovna Rada of Ukraine, or the interagency agreements concluded on their basis, including automatic exchange of information according to the CRS reporting standard.
The law of the United States on the Foreign Account Tax Compliance Act (FATCA) officially went into effect on July 1, 2014. It is aimed at combating offshore tax evasion by encouraging transparency and obtaining information on accounts held by U.S. taxpayers in other countries. FATCA enables foreign banks to share reporting on financial accounts maintained by U.S. citizens with the U.S. Internal Revenue Service (IRS).