Question 6963 — treaties and conventions

Summary

In terms of taxation, the United States recognizes the principle of taxation on the basis of citizenship, which can be acquired simply by birth on American soil. French citizens who also have American nationality are therefore required, by American law, to declare their income to the tax services of this country and to pay, where applicable, the taxes due. It goes moreover the same for all American citizens residing in France.  A bilateral tax convention having been concluded between France and the United States with a view to avoiding double taxation, it is only in cases where the French tax is lower than that due to the United States or where certain income is not effectively taxed in application of French tax law and is, moreover, taxable according to the legislation of the United States, that additional taxation could be requested by the American tax authorities. On November 14, 2013, France signed an intergovernmental agreement, known as the “FATCA agreement,” relating to compliance with tax obligations regarding foreign accounts. Entered into force on October 14, 2014, this agreement establishes a framework for the automatic exchange of tax information with the United States and aims to protect legal certainty French financial institutions. It was concluded following the “FATCA” law (Foreign Account Tax Compliance Act) that the United States adopted in 2010 and which establishes an obligation, for all financial institutions, to transmit to the American tax administration detailed information on accounts held directly or indirectly by American taxpayers. In this context, a collective was formed to draw the attention of the Ministry of Europe and Foreign Affairs and the Ministry of the Economy and Finance to the particular situation of "accidental Americans", that is to say French citizens also having American nationality but having no links with the United States. In the absence of concrete links with the United States, where they have not resided, and official documents from this country, these people can indeed encounter difficulties in providing the information requested by French financial institutions, in particular an American tax identification number which can take a particularly long time to obtain. In response, the Ministry of Europe and Foreign Affairs requested the attention of the American authorities on these situations. France pleads in favor of an easier renunciation of American nationality for these "accidental Americans", it being understood that the conditions for granting nationality and the principle of taxation on the basis of citizenship fall within the sovereign jurisdiction of the United States. This question is also the subject of discussions at European level, which is monitored more particularly by the Ministry of the Economy and Finance. A letter was therefore sent to the Secretary of the American Treasury on May 8, 2017, by the Presidency of the EU, drawing attention to the concrete difficulties encountered by certain European citizens who also have American nationality. France wishes to continue the dialogue on this subject, by intervening jointly with other European countries also concerned, to ensure that, in situations where links with the United States are tenuous, the procedure for renouncing nationality is made simpler and less expensive. Furthermore, the government will be vigilant about banks' compliance with their obligations towards people of American nationality, so that their right to an account is recognized and applied effectively. France recalls on this occasion that there is an appeal procedure before the Banque de France making it possible to force a bank to accept the opening of an account, the establishment then being designated by the Bank of France. France will continue to closely monitor this subject and seek suitable solutions.

Machine translation from French. The official text remains authoritative.

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