By Naomi Jagoda
Rep. Mark Meadows (R-N.C.) and Sen. Rand Paul (R-Ky.) offered legislation Thursday to repeal an Obama-era offshore tax law.
The bill would do away with provisions of the Foreign Account Tax Compliance Act (FATCA), which requires foreign financial institutions to report information about accounts held by U.S. citizens to the IRS.
FATCA was designed to fight offshore tax evasion. But Meadows and Paul said that the law violates citizens’ privacy rights. A release from Meadows’s office also claims the law has led to people giving up their U.S. citizenship in record numbers.
“Over time, it’s become clear that FATCA goes well beyond what is permissible under Fourth Amendment protections and places a serious burden on taxpayers,” said Meadows, who chairs the House Freedom Caucus.Paul said that the law “discourages foreign investment and prevents Americans from accessing the financial system overseas.”
Congressional Republicans and President Trump have made tax reform a high priority, and a number of free-market groups are lobbying for FATCA repeal to be included in tax reform legislation. The Republican Party platform also calls for a repeal of the law.
Meadows and Paul introduced similar legislation last Congress. Earlier this week, they sent a letter to Treasury Secretary Steven Mnuchin and Office of Management and Budget Director Mick Mulvaney, urging the Trump administration to issue a statement saying it is committed to repealing the law.