Tax evasion deal with Germany remains stalled

Germany’s finance ministry says several of its state governments are continuing to block a tax accord with Switzerland aimed at ending a long-running dispute over German tax evaders.

The deal needs approval by the German parliament’s upper house, which represents Germany’s 16 states and where Chancellor Angela Merkel’s centre-right government lacks a majority.

The states governed by opposition Social Democrats want tougher terms than originally negotiated.

Switzerland has proposed changes but the German finance ministry said opposition-led states informed the government on Friday they were not prepared to support the agreement in its current form.

German officials reportedly said they hoped to achieve “a good result for all concerned” after two state elections in May.

Meanwhile, the Swiss authorities say they have received pledges from the German government that it will agree an accord on a withholding tax.

The Swiss cabinet is due to discuss the agreement in one of its next meetings. The finance ministry gave no further details.