France takes action on world tax evasion

1st September 2009, Comments 0 comments

France puts on the heat on 3,000 French tax evaders with Swiss bank accounts as OECD signs agreements with Switzerland to end banking secrecy laws.

Paris – France turned up the heat on tax cheats Monday, brandishing a list of suspects with accounts in Swiss banks, as the OECD hailed recent big strides in its worldwide battle against tax evasion.

"We are not bluffing, we have a list of 3,000 names" of French taxpayers, at least some of whom are "very probably" tax evaders, Budget Minister Eric Woerth told France's Radio Classique on Monday.

Woerth had announced the list at the weekend after Switzerland said it had signed a double taxation deal with France, due to enter force in 2010, allowing information to be shared to clamp down on tax cheats.

It was one in a series of agreements that Switzerland, under pressure from the Paris-based OECD economic body, has signed in recent months to ease banking secrecy laws that are widely regarded as an aid to tax evasion.

The OECD, which has led a campaign to set new standards for the exchange of information on suspect bank accounts, on Monday hailed a "revolution" in cooperation on the issue.

"Virtually all countries are moving to eliminate strict bank secrecy for tax purposes," said a summary of an OECD report released as ministers from 70 countries gathered in Mexico for a three-day meeting on fighting tax evasion.

The Organisation for Economic Cooperation and Development (OECD) said all its 30 members now followed its rules on sharing information for tax purposes after Austria, Belgium, Luxembourg and Switzerland accepted them.

It acknowledged the "substantial progress" made by Switzerland towards ending abuse of banking secrecy.

It also hailed moves by the Chinese administrative regions of Hong Kong and Macau, and by Singapore, Andorra, Liechtenstein and Monaco, to meet its strict tax standards.

"What has happened is nothing less than a revolution," the secretary-general of the OECD, Angel Gurria, said in a statement, reflecting the work of its Global Forum on Transparency and Exchange of Information launched in 2000.

Aiming to sharpen tax cooperation in the complex world of globalised banking, the OECD's efforts gained prominence this year when a crisis summit of the Group of 20 economic powers pushed hard to reform banking secrecy, seen as an aid to tax cheats.

"For decades it has been possible for taxpayers to hide income and assets from the taxman by abusing bank secrecy and other impediments to information exchange," Gurria said in Monday's statement.

"What these developments show is that this will no longer be possible."

In France, Woerth said most of the names had been obtained from the Swiss tax authorities, with others coming directly from the banking establishments concerned.

A spokesman for the Swiss Bankers' Association said it was "truly disconcerted by this announcement."

Swiss banking secrecy laws traditionally prevented banks from revealing any details of their clients, except in connection with criminal investigations.

Switzerland regards only tax fraud as a crime, with tax evasion treated as a more minor offence, a judicial distinction that does not exist in most other major economies.

But under agreements with France and others, Switzerland will now disclose banking data linked to any tax offence.

The OECD also hailed moves, currently at various stages of implementation, by states and territories including Brunei, Costa Rica, Guatemala, Malaysia, the Philippines, Uruguay and the south Pacific island of Niue.

Switzerland, long regarded as a major tax haven, has now signed agreements with four OECD countries to meet the grouping's standards on sharing banking information, and deals with several other countries are in the works, it noted.

Switzerland also said on Monday that it had agreed a double taxation deal, yet to be formally signed, with Singapore.

AFP / Expatica

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