Egypt’s Ahli United Bank has recently signed an agreement with the Internal Revenue Service (IRS), the US tax authority, to adopt the FATCA law (Foreign Account Tax Compliance Act).
Ashraf Shabib, Head of the Retail Banking division at Ahli United Bank, revealed that the bank signed a contract with Ernst & Young LLP, so that the latter would provide technical and financial consulting needed to meet with FATCA’s terms and conditions.
The Foreign Account Tax Compliance Act (FATCA) was signed into law on 18 March 2010. Its purpose is to uncover U.S. persons who may be evading U.S. taxes by investing through foreign financial institutions (FI) or other foreign entities.
Countries refusing to comply run the risk of causing their financial institutions to be subject to a 30% withholding tax on both income and capital from US sources.