Today in Washington, the Vice Chairman of the House Ways and Means Committee, Phil Crane, called on the Internal Revenue Service (IRS) to withdraw a proposed regulation (REG-133254-02) that would require the reporting of bank deposit interest paid to non resident aliens. (see link below)

According to Rep. Crane, this regulation could *”drive hundreds of billions of dollars of capital out of the American economy – with no increase in revenue to the U.S. Treasury.”*

The argument is that if investors decide America’s financial system no longer has a necessary level of personal privacy, money that would have been put to work in America instead will be deposited in Switzerland, Hong Kong, and other financial centres around the world.

*”The Internal Revenue Service is supposed to enforce the tax laws approved by Congress. It is with some dismay, therefore, that I see that the Service has issued a regulation designed to overturn existing Congressional intent,”* said Rep. Crane. He felt the goal, clearly seen in legislative discussion, should be to attract capital to the American economy where it will be used to create jobs and boost growth.