On 3 April, Ambassador Pamela Spratlen and Chairman of the State Tax Committee of Uzbekistan, Botir Parpiyev, signed the Inter-Governmental Agreement (IGA) to improve International Tax Compliance with respect to the Foreign Account Tax Compliance Act (FATCA).

Uzbekistan is the first country in Central Asia to sign an IGA on FATCA with the United States. The IGA will ensure compliance with US tax laws for U.S. citizens working in Uzbekistan, the statement of the Embassy reads.

The US adopted FATCA several years ago and it came into effort in summer of 2014. FATCA requires all financial institutions outside of the US to periodically transmit information on financial accounts held by US persons to the US Internal Revenue Service (IRS), or face a 30 percent withholding tax on payments made from the US.

Original FATCA regulations created a reporting regime under which all foreign financial institutions would have to sign individual agreements to disclose their US clients to the IRS. This regime was modified by introducing IGAs, which were intended to increase compliance and impose a heavier legal burden on financial institutions by integrating FATCA into local law.

As of 31 December 2014, the FATCA information sharing regime has grown to encompass 52 countries that have formally signed an IGA with the United States and 60 countries that have reached agreement in substance to sign the agreements.