THE UNITED States government is assessing the capability of Philippine authorities to also go after American taxpayers in the country who may have tax liabilities.
On its website, the Bureau of Internal Revenue reported that Revenue Commissioner Kim S. Jacinto-Henares and other top BIR officials met with representatives of the US Internal Revenue Service (IRS) at the BIR national office in Quezon City last March 26 to 27.
According to its website, the IRS is the US government agency responsible for tax collection and tax law enforcement. The BIR is its counterpart in the Philippines.
During the bilateral meeting, the Filipino and American tax authorities “[discussed] the implementation of the Foreign Account Tax Compliance Act (Fatca),” the BIR said.
In a text message last Friday, Henares explained that the US tax officials came to town “to assess if the BIR will be able to comply with IRS requirements regarding Fatca in terms of laws, regulations and security.”
Fatca, which became law in the US in 2010, “targets tax noncompliance by US taxpayers with foreign accounts,” the IRS noted on its website.
Specifically, Fatca focuses on reporting by American taxpayers about their foreign financial accounts and offshore assets, as well as foreign financial institutions’ disclosures of financial accounts being held by US taxpayers or foreign entities that have substantial American ownership.
“The objective of Fatca is the reporting of foreign financial assets; withholding is the cost of not reporting,” the IRS said.
The BIR and IRS officials “conferred with each other on matters of legal framework, information technology security management, monitoring and enforcement, and infrastructure,” according to the BIR.
“Representatives from both sides expressed optimism and exuded a spirit of cooperation in Fatca,” the BIR added.
The BIR’s international tax affairs division monitors the Fatca Implementation Project, which the agency said is among its priority programs.