Germany and the US have signed an intergovernmental agreement (IGA) focused at improving tax information sharing.
German Government said that the deal marks a crucial step toward the implementation of a global model for the automated sharing of tax-related information.
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The agreement is linked to the US "Foreign Account Tax Compliance Act" (FATCA) which says that as of 2015, foreign financial institutions will be required to notify the US tax authorities of accounts held by US clients else, they would be taxed at a rate of 30% on earnings on US investments.
Germany, France, the UK, Italy, Spain and the US agreed in February 2012 to extend cooperation on efforts to combat tax evasion.
By September 2015 Germany aims to notify the US tax authorities for the first time about accounts held by US citizens and corporations. This notification will cover the year 2013. In return, the US pledged to provide partner states with tax-relevant information.
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