Sept. 5 (Bloomberg) -- Swiss Economy Minister Johann Schneider-Ammann said that political jockeying before German elections next year may be hindering progress on a tax agreement with Switzerland.
“I’ve got the impression that election politics are part of the game,” Schneider-Ammann said in an interview in Bern on Sept. 3 when asked about the influence on the stalled accord of Germany’s federal vote due in the fall of 2013. “It’s important that we reach a conclusion on the withholding tax agreement with Germany.”
Switzerland reached agreement with Germany last year over the taxation of undeclared bank accounts, under which Swiss banks would collect taxes on investment and capital gains while client identities are kept secret. The accord, which includes a levy for not disclosing accounts in the past, is stalled after Germany’s main opposition Social Democratic Party blocked it in the upper house of parliament, saying the deal is a loophole for tax evaders.
Even so, Schneider-Ammann said that he’s optimistic an accord can still be reached. “Once this has been cleared, I expect other countries to show interest as well,” he said.
His comments were echoed by Patrick Odier, chairman of the Swiss Bankers Association, who told reporters in Zurich yesterday that he expects the accord to come into effect.
Switzerland has been under increasing pressure to weaken its banking secrecy laws introduced in the 1930s after UBS AG, the country’s largest bank, was forced in 2009 to pay $780 million, admit it fostered tax evasion and turn over data on about 4,700 clients to the U.S. to avoid criminal prosecution.
Schneider-Ammann said he expects the banking secrecy law to be maintained and that it should be treated “carefully.”
“I expect the withholding tax to prove the right way, even if discussions are currently difficult -- abroad and at home,” he said. “Banking secrecy was never an invitation to avoid taxes.”
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