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End of banking secrecy

Parliament agrees tax data accord with EU

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The Swiss parliament has approved accords with the European Union and Australia for the automatic exchange of tax information. They are based on international standards and should become operational in 2018.

Following a final debate on Tuesday, the House of Representative followed the Senate in approving two separate agreements despite opposition by the conservative right Swiss People’s Party.

Supporters said Switzerland should become a model for transparent financial centres around the world and combat tax evasion.

Opponents, meanwhile, called for additional conditions to prevent Switzerland from being handicapped against competitors such as Britain, the United States, Hong Kong and Singapore.

They wanted to exclude tax data exchange with several European countries – Greece, Bulgaria, Croatia, Romania and Estonia – for legal reasons.

The proposal was roundly rejected and centre-right Radical Party member Christian Lüscher warned against trying to set exceptions.

“The last country to try to do so is Panama. It is obvious that it did not really succeed and I don’t think there are too many people in our country who would like Switzerland to get the same treatment at an international level like Panama has done recently,” he declared.

No choice

Finance Minister Ueli Maurer called on parliament to agree the accords in an effort to create legal security.

He said Switzerland had little choice but to follow suit, but he pledged to implement the accords judiciously.

Using a comparison from the world of football, he added: “It is important who plays best under the new rules. Looking at Switzerland, we can see that we have excellent preconditions. A currency of our own, high political stability as well as a strong and diversified economy.”

International standard

Following the global financial crisis in 2008, the Group of 20 major economies has been pushing for international rules to crack down on tax cheats.

About 90 countries have already agreed on automatic data exchange and more than half of them will start implementing the standard, Maurer said.

The agreement with the EU is effectively aimed at replacing a 2004 accord with the 28-nation bloc.

The government is preparing similar agreements with Japan, Canada, South Korea as well as Norway, Iceland and the three British islands, Guernsey, Jersey and Man.

A treaty paving the way for lifting banking secrecy between Switzerland and the United States came into force in 2014. A mandate for negotiations providing for the automatic exchange of tax information was approved by the government in the same year. 

Last December, the Swiss parliament agreed the legal basis for the data exchange based on a convention of the Council of Europe and Organisation for Economic Co-operation and Development (OECD).

Urs Geiser, swissinfo.ch



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