Of Special Interest


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24th February 2012

Swiss propose withholding tax to sort tax issue

Eveline Widmer-Schlumpf, Swiss Finance Minister has been talking about the attempts by the government to be proactive in making Switzerland tax-compliant with other countries. The minister hopes that a fundamental double-tax agreement will be reached with the US by September. She said:

"We are trying to formulate a set of credible, concrete proposals to improve our financial centre efficiency, and achieve a better balance between private bank privacy and tax compliance."

The government whilst accepting there are some changes needed in the law puts much emphasis on the banks arguing that banks need to be more diligent when accepting deposits. The government has also long argued for the withholding tax
approach with an amount withheld until the customer can produce proof that the relevant tax authority is aware of the account and / or has given authority for the tax authority to be given information on the account. It argues also that by reaching agreement it will create the best basis for a sustainable successful banking sector in Switzerland.

Other political parties and banking organisations all agree something must be done and broadly agree with the government approach whilst at the same time finding aspects of the proposals to criticise.