DUBAI: Expatriates in the UAE have been alerted about the implementation of a new global transparency policy that seeks to fight cross-border tax evasion and put an end to banking secrecy in tax matters.

Countries around the world have been looking for ways to track down and monitor tax-delinquent residents overseas. Offshore tax abuse is reportedly costing America alone $100 billion a year. This has resulted in the launch of the common reporting standard (CRS), also referred to as the global FATCA, which stands for Foreign Account Tax Compliance Act in the United States (US).

FATCA is a similar, but separate piece of legislation which is directed mainly at American citizens residing abroad. CRS, on the other hand, is being spearheaded by the Overseas Economic Cooperation and Development (OECD) and includes the European Union and other signatory states, such as the UAE, India, United Kingdom, Canada, Lebanon, Indonesia and Mexico, among many others, Gulf News reported.

CRS aims to foster an exchange of information between countries regarding expatriate or individual bank accounts, interest, dividends or incomes earned outside their home country. "Tax cheats have nowhere left to hide," OECD secretary-general Angel Gurria said during the launch of CRS.  In compliance with the global tax compliance regulation, financial institutions in the country will start collecting next year the necessary tax-related information from customers.

“From the beginning of January 2017, governments will start requiring all banks and other financial institutions to ask customers for information with a view to determining where they are resident for tax purposes,” HSBC stated in its December 8 letter to its customers.