ussian State Duma passed draft law to allow local banks to disclose information to foreign tax authorities in a first reading
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ussian State Duma passed draft law to allow local banks to disclose information to foreign tax authorities in a first reading

17.06.2014 Russia’s State Duma passed draft law to allow local banks to disclose information to foreign tax authorities in a first reading.

 

Under this law, Russian financial institutions shall identify foreign taxpayers among the clients and report about them to the Federal Financial Monitoring Service (Rosfinmonitoring), Federal Tax Service and Central Bank.

 

Upon receipt of the request from foreign tax authorities Russian financial institutions shall receive endorsement from Rosfinmonitoring to disclose the required information.

 

Also under the draft law failure to disclose information on taxpayers – foreign residents is subjected to a fine for officials, as well as for financial institution.

 

Thus, the law regulates the activity of the Russian financial institutions under the U.S. FATCA law in the absence of the intergovernmental agreement (IGA) with the USA. In particular, Russian banks will have the right to report details of accounts and transactions of their clients - US taxpayers to the IRS. Should the client doesn’t agree to disclose the information; the bank will have the right to close his account.

 

The draft law is expected to be adopted by the State Duma by the end of its spring session.

 

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