The Swiss cabinet has decided to sign an international convention on mutual assistance in tax matters. The government says it will show that Switzerland is committed to fighting tax fraud while preserving the country’s reputation.
The convention, put together by the Organization for Economic Cooperation (OECD) and the Council of Europe, provides a framework for tax cooperation between states. It includes the possibility of information exchange upon request.
Automatic exchange of data is possible under the convention, but requires additional agreements between the states involved.
In a statement, the finance ministry said on Wednesday the decision was further proof of the country’s acceptance to comply with international standards in tax matters.
“It also confirms Switzerland’s commitment to the global fight against tax fraud and tax evasion with a view to safeguarding the integrity and reputation of the country’s financial centre,” it added.
Once signed, the convention will still have to be submitted for consultation before heading for ratification by parliament and then potentially going to a nationwide vote – all before it can be implemented.
Over 50 countries have signed the convention so far and it is in force in approximately 30 countries.
The government has also decided to launch talks over the revision of the taxation of savings agreement with the European Union. EU finance ministers gave the European Commission the mandate to negotiate an amendment of the accord with Switzerland and other countries.
The EU wants the agreements to be in line with the planned revision of its savings directive, which requires Swiss banks to levy withholding taxes on the accounts of European Union clients.
Switzerland has said since 2009 that it is open to revising the accord to eliminate any loopholes. However it has also demanded improved access to cross-border financial services and facilitated conditions for banking licences for Swiss banks within the EU.
In compliance with the JTI standards