Italy is edging closer to a tax deal with Switzerland that would yield Rome “a lot of money quickly“, according to Alfredo Gysi, head of the Association of Foreign Banks in Switzerland.

"/> Italy is edging closer to a tax deal with Switzerland that would yield Rome “a lot of money quickly“, according to Alfredo Gysi, head of the Association of Foreign Banks in Switzerland.

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Tax deal ‘could yield Italy a lot of money’

Italy is edging closer to a tax deal with Switzerland that would yield Rome “a lot of money quickly“, according to Alfredo Gysi, head of the Association of Foreign Banks in Switzerland.

Speaking in an interview with the Tages-Anzeiger newspaper, Gysi said there is a growing awareness that a tax deal with Switzerland would be beneficial for Italy.

“Italy is struggling to get its financial challenges under control. An agreement with Switzerland would bring in a lot of money quickly and prevent future tax evasion,” he said.

Gysi is also CEO of BSI (Banca della Svizzera Italiana) and has been a member of the board of the Swiss National Bank (SNB) since May 2011. In July 2009, he become one of the instigators of a withholding tax on assets held in Swiss banks that proved instrumental in securing deals with Germany and the UK. 

After a worldwide campaign against tax havens, Switzerland agreed in 2009 to soften its strict bank secrecy to comply with standards set by the Organisation for Economic Cooperation and Development (OECD).

Since then, the country has finalised successful tax agreements with Berlin and London allowing “customers, banks and the affected countries to reach their goals.”

The Swiss canton of Ticino, just across the border from Italy, has been an easy place for Italians to hide their money, and its banking association has estimated assets under management of around 345 billion Swiss francs ($390 billion).

During the last Italian tax amnesty in 2009, the third in eight years, at least 72.3 francs ($81.7 billion) were declared from Switzerland with 5 percent of assets paid to the Italian government. 

Despite the amnesties and an imminent tax deal, there has recently been an increased flow of capital from Italy into Switzerland, according to Italian media reports.

Gysi told the Tages-Anzeiger he thinks the attractiveness of Switzerland for taxed wealth may increase thanks to withholding tax, especially in the upper client segment.

“It no longer resides in the grey zone, but in daylight. It is cross-border banking, based on competence and trust in Swiss banks. For high net worth people, these factors are important, even if an account in Switzerland no longer has tax advantages.” 

However, Swiss officials believe that a tax agreement with Italy will be more difficult to reach than those with Germany and the UK, largely due to Giulio Tremonti, Italy’s finance minister who has been fiercely critical of Switzerland’s “tax haven”.

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Three scenarios: How Switzerland plans to fight a Covid resurgence

Swiss government has devised three contingency plans that could be implemented to fight a new outbreak. What are they?

Three scenarios: How Switzerland plans to fight a Covid resurgence
Authorities want to prevent overcrowded hospitals if new wave comes. Photo by Fabrice Coffrini / AFP

Although Switzerland relaxed a number of coronavirus rules from June 26th and 28th, “the pandemic is not over”, as Health Minister Alain Berset said at a press conference on Wednesday.

Berset said Switzerland should not become complacent, with last summer a warning against feeling that the battle is won. 

He added, however, that the new wave is unlikely to be as large as the previous ones due to the country’s vaccination campaign.

This situation leaves a degree of uncertainty for which the government wants to be prepared as well as possible, Berset noted.

The Federal Council established a “just-in-case” procedure on Wednesday for three possible scenarios that could take place in the autumn and winter. 

These plans focus mainly on the rapid detection of variants and the continuation of vaccination, testing, and tracing.

The best-case scenario: status quo

In this scenario, the number of cases remains at a low level, though small outbreaks are still possible.

The number of infections may increase slightly due to seasonal factors — the virus is known to spread slower in summer and faster in autumn and winter—  but does not place a significant burden on the health system.

If this happens, no measures beyond those already in place would be necessary.

READ MORE: ANALYSIS: Is Switzerland lifting its Covid-19 restrictions too quickly?

Not so good: more contaminations

In this second scenario, there is an increase in the number of cases in autumn or winter.

There may be several reasons for this, for example the large proportion of unvaccinated people, seasonal effects — people tend to stay indoors together in cold weather, and contaminations are easier — or the appearance of new, more infectious variants.

This situation could overburden the health system and require the reintroduction of certain measures, such as the obligation to wear a mask outdoors.

Booster vaccinations may also be necessary.

The worst: new virus mutations

In scenario three, one or more new variants appear, against which the vaccine or the post-recovery immunity are less effective or no longer effective.

A new wave of pandemic emerges, requiring strong intervention by the public authorities and a new vaccination.

Which of the three scenarios is most likely to happen?

The government hasn’t said, but judging by the comments of health officials, the latter two are the strongest contenders.

Firstly, because the highly contagious Delta mutation, which is spreading quickly through many countries, is expected to be dominant in Switzerland within a few weeks.

It is expected that the virus will spread mostly to those who are not vaccinated and, to a lesser degree, to people who have only had one shot of the vaccine, according to Andreas Cerny, epidemiologist at the University of Bern

READ MORE: How Switzerland plans to contain the Delta variant

Another concern is related to the appearance of the new variants which could be as or possibly even more contagious than Delta and not as responsive to the current vaccines.

The government said the best chance of avoiding the second or third scenarios is to ensure people are vaccinated. 

“Widespread vaccination of the population is crucial to relieve the burden on the healthcare system and to manage the epidemic. A possible increase in the number of coronavirus cases in the autumn will largely depend on the proportion of the population that has been vaccinated,” the government wrote in a press statement.

The government has also indicating it is preparing for booster vaccinations to take place in 2022 and are encouraging cantons to keep their vaccine infrastructures in place.