The EU will use a February financial summit with the US to again press for help for the “accidental” Americans caught up in a 2010 US tax avoidance law, a European Commission official said Wednesday.
At the Feb. 7-8 meeting of the EU-US Financial Regulatory Forum, the commission, the EU’s executive, will “ask about the possibility for a more permanent solution” to problems created by the 2010 US Foreign Account Tax Compliance Act, said Andrea Liesenfeld, European Commission deputy head of retail financial services.
Accidental Americans in the EU—those that have never lived or worked in the US but are US citizens through a US parent or because they were born in the US—have long complained about being denied financial services, because overseas banks see them as a compliance burden under FATCA. The law requires non-US banks to provide information for tax purposes on accounts held by US citizens.
Liesenfeld said the EU would ask why Treasury Department guidance relaxing some of the FATCA obligations on foreign banks applied only to bank accounts that already existed in 2014. The limited relief “of course doesn’t fully solve the problem,” Liesenfeld told the European Parliament’s Petitions Committee.
The Treasury guidance, released Dec. 30, said banks unable to report US Social Security or taxpayer identification numbers, which accidental Americans generally don’t have, won’t be deemed “significantly noncompliant” with FATCA. The relief applies from 2022 to 2024.
The Treasury Department declined to comment on the issue.
Petitions Committee lawmakers working on FATCA-related issues said they had made little progress in pushing for legal changes in the US to reduce the burdens for accidental Americans.
“The US authorities we met have told us there is no problem because it has nothing to do with their electorate, but with ours,” said Kosma Zlotowski, a Polish member of the committee.
The 2024 European Parliament and US presidential elections could delay action, said Yana Toom, an Estonian lawmaker who headed a Petitions Committee delegation to Washington last year to discuss FATCA.
“Next year, in January, everybody will be campaigning,” Toom said. “If we do not act now, I mean tomorrow, then this will delay for three more years.”
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