Reuters: Financial Services and Real Estate: Swiss FinMin says withholding tax deals will prove efficient -media

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Swiss FinMin says withholding tax deals will prove efficient -media Apr 29th 2012, 12:41 ZURICH, April 29 | Sun Apr 29, 2012 8:41am EDT ZURICH, April 29 (Reuters) - Switzerland's finance minister says withholding tax deals secured with Germany, Britain and Austria will prove to be efficient, a newspaper reported on Sunday, af t er a Swiss political party attempted to stall the legislation. Switzerland recently clinched the deals to tax undeclared assets held in offshore bank accounts and they are due to come into effect next year. However, they could face delay if Switzerland's Social Democrat Party (SP) can marshall support for its bid to delay voting on the deals until late this year. The SP is urging the government to agree to freely exchange data on foreigners' assets in Swiss bank accounts with the accountholders' respective governments. "Our partner states will see how efficiently the model of withholding tax and regularising undeclared assets works once the pacts come into force," Sonntagszeitung quoted finance minister Eveline Widmer-Schlumpf as saying in an interview. The pacts are the cornerstone of Swiss efforts to maintain the country's long-held banking secrecy by taxing accounts held in Switzerland by foreigners and levying a punitive charge on money not declared to their national authorities. Widmer-Schlumpf said several more countries were prepared to negotiate similar deals but did not name any of the countries. Automatically exchanging information is the practice in many European Union member states, and Switzerland is struggling to get its neighbours to agree to lucrative withholding tax deals, which allow bank accountholders to pay tax without having to reveal their identity. Widmer-Schlumpf did not elaborate on ongoing talks with U.S. justice and tax officials over a dispute on unpaid taxes in hidden Swiss offshore accounts, following a meeting last weekend in Washington with U.S. Treasury Secretary Timothy Geithner and Attorney General Eric Holder. A global crackdown on tax evasion by cash-strapped governments in recent years has chipped away at Switzerland's tradition of banking secrecy, which helped it build up a $2 trillion offshore wealth management industry. Eleven Swiss banks - including Credit Suisse and Julius Baer - are under investigation by the United States for aiding U.S. citizens suspected of tax dodging. Switzerland wants the investigations dropped, in exchange for payment of fines and the transfer of names of thousands of U.S. bank clients. It also wants a deal to shield the remainder of its 300 or so banks from U.S. prosecution. (Reporting By Katharina Bart; Editing by Susan Fenton) Link this Share this Digg this Email Reprints

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