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Committee on Financial Services

[PDF version with signatures]

U.S. House of Representatives
Committee on Financial Services
2129 Rayburn House Office Building
Washington, DC 20515

May 4, 2004

The Honorable John W. Snow
Secretary
Department of the Treasury
1500 Pennsylvania Avenue, N.W.
Washington, D.C. 20220

Dear Secretary Snow:

The Internal Revenue Service has proposed a regulation that would require U.S. depository institutions to report interest paid to non-resident alien depositors who reside in 16 specific countries (REG 133254-02). In its original form, this regulation included depositors from Latin American countries. However, the Treasury Department took a good first step when it decided to exempt depositors from Latin American countries after it was learned that 'depository institutions in both Florida and Texas could face the loss of a massive number of deposits. We write to urge you today to take the next step and Withdraw this proposed rule altogether.

We believe that, as drafted, this proposed regulation is arbitrary and discriminatory to investors from those countries that it targets. Moreover, it imposes an unnecessary regulatory burden on U.S. institutions and may drive investment out of our country without having any beneficial impact on U.S. tax policy or tax collection. The United States should be fostering a climate that encourages investment, not one that punishes it.

Thank you for consideration of our views on this issue.

Yours truly,

Michael G. Oxley
Richard H. Baker
Spencer Bachus
Robert W. Ney
Sue W. Kelly
Darlene Hooley
Ron Paul
Dennis Moore
Christopher Shays
Vito Fossella
Steve Israel
Mike Ross
Jim Matheson
Jeb Hearsarling

 

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