Switzerland To Sign Multilateral Convention Vs Tax Evasion

Tom Burroughes Group Editor Valletta Malta 15 October 2013

Switzerland To Sign Multilateral Convention Vs Tax Evasion

The Swiss government is to sign a multilateral treaty to combat tax evasion today, the Financial Times reported, following recent moves by the Alpine state to co-operate with other major jurisdictions.

The Swiss government said signing the convention on so-called mutual administrative assistance in tax matters confirmed its “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”, the FT reported.

A few days earlier, as reported by WealthBriefing, the Swiss Federal Council said it has approved the signature of an international convention on tax and adopted a mandate to negotiate a revised European Union agreement on the tax of savings.

The Swiss government's official website made no mention of any signing ceremony today.

The latest move – if it happens – will represent a further development in the erosion of the country’s historic bank secrecy laws, which in their modern form date back to 1934. The country, which derives about 12 per cent of its GDP from banking and finance, has already inked a sweeping bilateral agreement with US authorities to deal with Swiss banks’ offshore accounts to wealthy Americans, and has also signed disclosure agreements with the likes of the UK.

Swiss banking is home to an estimated SFr5.56 trillion ($6.10 trillion) of assets in total.Out of the SFr5.56 trillion figure of assets, about half of that sum is run for foreigners, according to the Swiss Bankers Association.

The FT quoted Pascal Saint-Amans – the senior tax official at the Paris-based OECD which aims to promote sustainable economic growth – as describing the Swiss move as “very significant”.

The country will not ratify the mutual assistance convention this year – its parliament has to agree to the decision and it needs to be put to a referendum. The Swiss government has agreed to make changes required by the OECD, including the revision of double tax treaties; provision of more transparency on bearer shares, which are physical documents that confer ownership of businesses; and tighter rules on information exchange. These changes also need to be agreed by parliament and are subject to a referendum, the newspaper report added.

Register for WealthBriefing today

Gain access to regular and exclusive research on the global wealth management sector along with the opportunity to attend industry events such as exclusive invites to Breakfast Briefings and Summits in the major wealth management centres and industry leading awards programmes