EU wants renegotiation of Swiss tax treaty

The European Commission is pressuring Germany and Britain to change the bilateral fiscal agreements they have worked out with Switzerland.

This content was published on November 18, 2011 - 17:48
Tanguy Verhoosel in Brussels,

If they refuse to do so, the commission said it would open infringement proceedings against Berlin and London by the end of the year. The texts have already been drafted.

The so-called Rubik agreements provide for the introduction in Switzerland of a withholding tax in full discharge of all tax obligations on the assets placed by German and British residents in this country and on the income they continue to collect on these assets.

The commission’s legal service judges Berlin and London to have overstepped their competences by signing these agreements, which protect the anonymity of fraudsters and whose scope partly interferes with EU rules on the taxation of savings income – and the agreement between Bern and the EU in this area.

The commission therefore wants to see the opening of proceedings against Berlin and London before the EU Court of Justice for failure to fulfil obligations.

To avoid that option if possible – since it would create a poor impression in the middle of a severe eurozone crisis – Taxation Commissioner Algirdas Semeta is trying to convince Germany and Britain to renegotiate their agreements with the Swiss.

Semeta met German Finance Minister Wolfgang Schäuble on November 8 and will meet Swiss Finance Minister Eveline Widmer-Schlumpf on November  25. The commission’s experts have already met Berlin’s experts and will meet British experts on 18 November.

Depending on the outcome of these meetings and the follow-up by Switzerland, Germany and Britain, the commission will decide whether to embark on infringement proceedings, theoretically by the end of December.

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