Switzerland wants OECD-wide deal on tax information

17th June 2013, Comments 0 comments

Switzerland said Monday that it wants the OECD group of industrialised nations to broker a global deal on the exchange of information about people who bank their cash outside their homeland.

In a statement, the Swiss government said that a "global standard" was necessary for the automatic exchange of information for taxation purposes.

"The most suitable body for preparing this would be the broadly based Organisation for Economic Co-operation and Development," it said, referring to the 34-nation grouping.

The statement was issued after Swiss Finance Minister Eveline Widmer-Schlumpf met with European Union tax chief Algirdas Semeta.

The financial crisis has thrown the spotlight squarely on the issue of tax evasion, notably by EU and US citizens who bank their cash out of sight of their home countries' authorities.

Swiss lawmakers are Tuesday scheduled to vote on a controversial deal with Washington that would give the Alpine country's banks legal closure in probes of their alleged complicity with tax evasion, in exchange for their paying potentially massive fines.

Switzerland has also repeatedly locked horns with the EU over the tax issue.

"Switzerland expects the EU to dispense with defensive measures against Switzerland and to be fair," the government said.

Switzerland, staunchly outside the 27-nation EU, is surrounded by the bloc's members and has tight economic ties with them.

Its financial sector is a traditional refuge for foreign depositors in tough times, and with the crisis having put tax havens into sharp focus, Switzerland has fought to defend its long-cherished principle of secrecy by giving ground in some areas but declining to allow the automatic handover of account details.

The EU has asked Switzerland to open talks on updating a 2005 deal on taxing the savings of EU citizens held in the banks in the Alpine nation.

"Switzerland has been willing to discuss such an amendment of the agreement since 2009, but it expects the EU to maintain access to its markets for financial services," the government said.

Switzerland taxes the savings of such depositors at a rate of 35 percent -- raised from the original 20 percent in 2011 -- and pays the funds anonymously back to member states.

Only interest in the purest sense is taxed, but Brussels wants to widen the net to cover dividends from shares and life insurance policies, as well as capital gains from the sale of shares and real estate.

The issue has sparked bitter debate within the EU itself, though resistance by traditional havens Austria and Luxembourg to the automatic sharing of bank records has been chipped away, five years after other member states approved new rules.

Switzerland has insisted that all the globe's offshore havens -- for example, Britain's various Caribbean territories -- must also fall into line to ensure a level playing field.

© 2013 AFP

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