VIENNA Austrian Chancellor Werner Faymann on Wednesday demanded movement in European Union tax talks with Switzerland and other non-EU countries and linked this to whether Vienna will agree to automatically exchange data on cross-border savings.
His remarks to reporters after he met Luxembourg Prime Minister Xavier Bettel appeared to signal a harder line in Vienna's stance on a long-running row that is supposed to be addressed at a European summit next month.
Unlike nearly all other EU members, who already exchange information on interest payments to EU citizens abroad, Luxembourg and Austria have long resisted revealing names of account holders, preferring instead to have banks apply a withholding tax.
Faymann, a Social Democrat, reiterated that Austria was committed to fighting tax fraud and would not turn a blind eye to people trying to stash funds in the country.
"But we do not want this to be unilateral. We demand that there is a progress in the negotiations, even with so-called third countries such as Switzerland, Liechtenstein, San Marino, Andorra and Monaco," he said.
He said he hoped the European Commission would report progress on this at next month's summit.
Bettel had said earlier this month that Luxembourg did not want to hold up an EU accord strengthening rules on how cross-border savings are taxed until deals with non-EU countries, such as Switzerland, have been reached.
But he showed solidarity with Austria in Vienna. "It is wrong that Austria stands alone in its stance," he said.
Austria had signaled flexibility this month on exchanging cross-border bank account data with fellow EU members even if there was no final EU accord with Switzerland.
"As far as banking secrecy for foreigners goes, it is important for us that there are similar accords with neighbors like Switzerland and Liechtenstein," Austrian Finance Minister Michael Spindelegger had said after meeting his Luxembourg counterpart Pierre Gramegna.
"There is no strict conditionality regarding finished treaties. It is important, however, that there are similar rules in all other countries promptly," he added.
Spindelegger, leader of the conservative People's Party, took over the finance portfolio in December, replacing Maria Fekter. She had vowed to "fight like a lion" to defend banking secrecy in Austria until other countries lay bare their own offshore financial centers.
(Reporting by Michael Shields; Editing by Susan Fenton)