American Foreign Accounts Tax Compliance Act (FATCA) drops in a surprise package on July 1 2014 on its citizens living abroad. Bound by the Act, American citizens living elsewhere around the globe are obliged to fill in annual tax forms which require information about the individuals’ incomes and bank accounts. Abdul Rehman Al-Habib, Deputy Director, Strategic Studies Center, rushes to the aid of fellow Arabs who have previously resided in the U.S. but are back to home. ‘These forms are very complicated and long! Citizens along will not be able to fill them’ states Al-Habib
Al-Habib has been working with the government and other legal analysts and advisors to devise methods whereby aiding the dismayed Saudi Americans who want to put aside their Green Cards to clear their FATCA files. But it looks like there is now way out of the dilemma, as put in by Todd Holmstrom, U.S. Consul to Jeddah. ‘They will have to clear the tax file first. Otherwise, they will face huge fines.’ Holmstrom explains. ‘Those who want to give up their U.S. citizenship will not be able to do so without clearing their taxes.’ says Al-Habib
According to Bandar Bin Abdullah Al-Niqaithan, ‘financial institutions would provide the U.S. authorities with authentic data and correct figures about the accounts of the U.S. citizens. Al-Niqaithan also states ‘The American authorities would impose a fine of thirty percent on transactions with foreign banks and financial institutions that do not commit to FATCA rules.’ Saudis, I’m sorry to say, cannot give up their U.S. citizenship very easily!’ What is the reason behind the needful? ‘The law aims to reduce cases of tax evasion.’ States Holmstrom.