• Switzerland edition
 
OECD deal means 'end of Swiss banking secrecy'
OECD headquarters in Paris. Photo: OECD

OECD deal means 'end of Swiss banking secrecy'

Published: 15 Oct 2013 16:16 GMT+02:00
Updated: 15 Oct 2013 16:16 GMT+02:00

This marks "the end of banking secrecy" in Switzerland, the head of tax issues at the Organization for Economic Cooperation and Development, Pascal Saint-Amans, told AFP.
   
The inclusion of Switzerland in the agreement to exchange information among more than 60 countries will be "highly significant" in the fight against tax evasion, he said.
   
OECD Secretary-General Angel Gurria said Switzerland's adherence to the the Multilateral Convention on Mutual Administrative Assistance in Tax Matters "sends a clear and strong signal that Switzerland is part of the community of states which consider international tax co-operation as a necessity".
   
At the instigation of many advanced countries, the Paris-based OECD has spearheaded a clampdown on tax evasion and the concealment of illicit funds.
   
Swiss banking secrecy in its current form took shape before World War II, and provided the victims of Nazi persecution with a way to protect their assets.

The movement to scrap the policy in Switzerland and other well-known "tax havens" arose after the financial crisis of 2008 and subsequent eurozone debt crisis.
   
Ordinary people with money woes, often facing higher taxes to cover the 
costs of the crises, were outraged by revelations of tax evasion and avoidance by corporations and wealthy individuals.
   
US tax authorities in particular took tough action against some Swiss banks.

   
At the same time, high-profile controversies arose when lists of bank 
accounts stashed in Switzerland were leaked to tax authorities elsewhere.
   
The Swiss ambassador to the OECD, Stefan Flückiger, said the signing of 
the Convention confirms Switzerland's commitment to fight tax fraud and "safeguards the integrity and reputation of the country's financial centre."
   
The convention's signatories so far include all 20 members of the Group of 
Twenty (G20) of the world's leading economies, as well as more than 40 other countries.
   
In addition to exchanging information, signatories agree to organize 
simultaneous controls to track tax fraud.
   
The main objective is to ramp up the effort to catch cheats who hide assets 
and transactions behind the protective laws of offshore tax havens.
   
Until now, many tax authorities and their governments have complained that 
cross-border tax investigations have been stymied by the complex routes used to hide funds, coupled with obstructionism on the part of some national authorities.
   
These difficulties have been exacerbated by the increased openness of 
frontiers to capital flows as well as the use of new technologies for transferring money.
   
Saint-Amans said the convention "prepares the way for the automatic 
exchange of tax information".
   
The OECD wants to make this the normal practice internationally, but it 
continues to be an extremely sensitive issue for the Swiss, as well as for some other countries.
   
Under the convention as it stands, however, the automatic exchange of 
information is optional.
   
The OECD noted that among the countries that have signed the convention or 
are preparing to are a number of jurisdictions often described as tax havens, some under the British crown, notably in the Caribbean.
   
Saint-Amans said the noose would continue to tighten on tax evasion and 
that countries that do not sign up to the agreement "would begin to be sidelined".
   
He said: "I can't see how going back could be possible."

   
Switzerland, which has been under strong pressure since the financial 
crisis to open up its banking secrecy and to tax foreign assets, announced its intention to sign the agreement last week.
   
At the same time, it expressed its concern to preserve the integrity and 
reputation of its financial institutions.
   
The next hurdle — which could prove a formidable one — is ratification of 
the convention by the Swiss parliament.

Don't miss...X
Left Right

Your comments about this article

Today's headlines
Cable car worker plunges to death in safety check
View of Gant-Hohtälli cable car tower. Photo: Valais cantonal police

Cable car worker plunges to death in safety check

A 39-year-old worker checking a cable car during a safety inspection died on Tuesday afternoon after falling from a pylon near Zermatt in the canton of Valais, cantonal police said. READ  

Switzerland's Bencic knocked out of US Open
Peng was too much for Bencic, shown here in action. Photo: Matthew Stockman/Getty Images North America/AFP

Switzerland's Bencic knocked out of US Open

Unseeded Peng Shuai of China swept past Swiss teen Belinda Bencic 6-2, 6-1 on Tuesday to reach the US Open women's tennis tournament semifinals. READ  

Witnesses sought after police car runs over man
The police car was responding to an assault complaint in Payerne. Photo: Alain Rouiller

Witnesses sought after police car runs over man

Investigators are seeking witnesses after a police car ran over a 22-year-old man who died on the A1 motorway in the canton of Fribourg last week as officers responded to a call from another man the victim had been in contact with, who reported having been assaulted. READ  

Tories pledge to expand UK expat voting rights
Tories promise expat Brits the right vote in the UK for the rest of their lives — if they win re-election. Photo: Hagwall/Flickr

Tories pledge to expand UK expat voting rights

The Conservative party in the UK is wooing expat voters by pledging to end the controversial “15-year rule” that prevents thousands of Brits in Switzerland and millions elsewhere abroad from being able to vote. READ  

Swiss economy slows down in second quarter
Graph showing GDP growth over past five years. Source: Seco

Swiss economy slows down in second quarter

The Swiss economy ground to a halt in the second quarter of this year with the country’s GDP (gross domestic product) unchanged from the first three months of 2014, government figures released on Tuesday show. READ  

Nude selfies secretary agrees to step down
Woman taking a selfie (not the secretary involved in Bern). Photo: Getty Images/AFP

Nude selfies secretary agrees to step down

A Swiss parliament secretary who posted naked selfies on her Twitter account after posing for the photos in her government office has agreed to give up her job. READ  

Wawrinka overcomes cramps in New York win
Photo: Al Belo/Getty Images North America/AFP

Wawrinka overcomes cramps in New York win

The Swiss third seed Stan Wawrinka battled cramps and a frightening fall on Monday but emerged with a gutsy four-set victory over Tommy Robredo and a quarterfinal place in the US Open tennis tournament. READ  

Burkhalter hails Second World War mobilization
Swiss President Didier Burkhalter. Photo: FDFA

Burkhalter hails Second World War mobilization

Swiss President Didier Burkhalter on Monday thanked the country’s citizens who mobilized 75 years earlier to defend the mountain country when the Second World War broke out. READ  

Swiss pay UK and Austria over tax dodging
Photo: Fabrice Coffrini/AFP

Swiss pay UK and Austria over tax dodging

Switzerland said on Monday that it had completed a programme to pay Britain and Austria hundreds of millions of euros in settlements for past tax-dodging by their citizens. READ  

Japan Novartis unit failed to report 'drug deaths'
Photo: Sebastien Bozon/AFP

Japan Novartis unit failed to report 'drug deaths'

The Japanese unit of Swiss pharma giant Novartis has admitted it did not report more than 2,500 cases of serious side effects in patients using its leukaemia and other cancer drugs, reportedly including some fatalities. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Sponsored Article
Car insurance made easy online with St Bernard
National
Swiss residents pick Swedes as ideal European soul mates: survey
National
Zurich officials call project to move prostitutes to 'sex boxes' a success
National
Swiss gays recognized as parents of child born to surrogate mother
Health
Increase in mountain bike accidents keeps Swiss hospitals busy
National
Swiss policeman belatedly honoured for saving Jews from Holocaust
National
'Suicide tourists' to Switzerland double in three years: study
National
Swiss Post SMS scheme gets stamp of approval after pilot project
Business & Money
American tax evasion crackdown hits Swiss private banks' bottom line
Politics
Woman accuses Swiss politician in nude selfies scandal of lying
National
Villagers in Graubünden valley reject hydro plant to protect vultures
Business & Money
Court rules against appellation for absinthe from Neuchâtel valley
National
Two hundred passengers rescued after landslide derails Swiss train
Travel
Switzerland remains world champion for per capita train travel
Culture
Social media backlash forces Polanski to bow out of Locarno film festival
National
Two policemen identified among three Israelis killed in train crash
Features
Untouched Alps: The Local explores Switzerland's only national park
National
Swiss government secretary tweets nude ‘selfies’ taken at work
International
Swiss couples fined in Ibiza for making love in van without seatbelts
National
Schumacher medical record theft suspect hangs himself in Zurich cell
National
Thousands of motorists drive without permits in Switzerland: report
National
Switzerland celebrates the centennial of national park in Graubünden
National
Animal rights group protests over dead fish throwing at festival
National
Federer forced to tear down kids' play area at Graubünden holiday home
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Latest news from The Local in Sweden

More news from Sweden at thelocal.se

2,034
jobs available