Transactions at Vietcombank. The bank plans to conform to the US' Foreign Account Tax Compliance Act to increase competitiveness in international transactions. — Photo thesaigontimes.vn

HA NOI (Biz Hub) ― Vietcombank plans to be the first Vietnamese bank to conform to the US' Foreign Account Tax Compliance Act (FATCA).

The registration procedures are expected to be completed before April 25.

The bank announced this in a news report earlier this month, as it selected the consulting firm KPMG Viet Nam to advise it on the issue.

FATCA is a set of new tax laws which will be effective from July 1, 2014. The US government enacted the law in 2010 to prevent and detect tax evasion by US taxpayers who are hiding income and assets overseas. The rules affect almost every financial institution in the world, including those in Viet Nam.

Vietcombank deputy general director Nguyen Danh Luong said that, with this move, the bank expresses the determination to comply with not only domestic laws but also international conventions.

The bank also aims to increase its prestige and competitiveness in international transactions, as it plans to expand agent networks worldwide.

According to the bank, obeying FATCA means that financial institutions will save significant business costs, since the Act sets a tax rate of 30 per cent for those which do not conform. The tax will be imposed on revenues originating from the US, including interests, dividends and incomes from the liquidation of profitable assets. ― VNS