Couchepin prepares for tax talks

Pascal Couchepin says Switzerland's banking secrecy is not negotiable Keystone Archive

The economics minister, Pascal Couchepin, has told European business leaders that banking secrecy will not be compromised by EU pressure.

Speaking to business leaders in Spain, which holds the rotating presidency of the European Union, Couchepin repeated Switzerland’s position that banking secrecy would not be compromised during talks to forge new bilateral agreements with the EU.

His address comes less than two weeks before Swiss negotiators prepare to hammer out an agreement on the taxation of EU citizens’ savings in Switzerland.

In an interview with swissinfo after his speech, Couchepin reiterated that banking secrecy was “not negotiable”, even if that meant no agreement would be reached on an accord to combat cross-border crime between Switzerland and the EU.

“We are open for new solutions to reach agreement on the taxation of savings and smuggling, but there are naturally limits and one limit is banking secrecy.”

Taxation of savings

Couchepin said Switzerland had a workable alternative to sharing information; namely a withholding tax on non-residents savings. Under this system, Switzerland would tax income on the assets of EU citizens and send the money to Brussels, but would not exchange any information about the asset holders themselves.

“The European Union wants to get back revenues from EU citizens’ savings in Switzerland,” he told swissinfo. “With our proposition of a withholding tax, we give a clear and positive answer to the interests of the EU so I think this is a good basis for an agreement.”

He made clear, though, that other financial centres would have to institute a similar system before Switzerland would do so.

“The withholding tax is our solution but it cannot be implemented as long as the EU has not got similar agreements with other third countries and other financial centres.”

Couchepin’s comments come a day after the Swiss government presented a united front on the issue, following media speculation of a rift in the cabinet.

Correspondents say that some cabinet members were thought to favour concessions on banking secrecy in order to conclude a second set of bilateral agreements with Brussels.

Last week talks came to a stand still, mainly because of disagreements over banking secrecy.

swissinfo