Jan. 14 (Bloomberg) -- German Chancellor Angela Merkel rebuked the opposition Social Democrats for blocking a tax treaty with Switzerland, saying that preserving the status quo only serves to help Swiss banks.
Campaigning for her party in the state of Lower Saxony, Merkel said it was a mistake for Germany not to join countries such as the U.K., Austria and Greece in negotiating a tax treaty with Switzerland. Had the pact been approved, it would have taken effect at the beginning of this year.
“We could have had 14 days already during which there would never again be tax fraud with Switzerland,” Merkel told a crowd at an event for her Christian Democratic Union in the western town of Stadthagen today. “And if you read the newspaper, who in Switzerland is happy that it didn’t happen? The banks -- the Swiss banks are happy.”
The Social Democrats last year blocked a treaty signed by Merkel’s government with Switzerland that sought to fight tax evasion by levying a withholding tax on Germans with Swiss accounts, while preserving a measure of bank secrecy.
The SPD stopped the legislation in the upper house of parliament, or Bundesrat, where Merkel lacks a majority, saying that the treaty was a giveaway to tax dodgers.
“I can only say: this isn’t my policy,” Merkel said in the speech ahead of the Lower Saxony state election on Jan. 20.
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