BERLIN Dec 9 German opposition-led states said they will continue to block a tax deal reached by the German and Swiss governments, crushing Berlin's hopes of salvaging the agreement through mediation, a magazine reported.
Last month the Bundesrat upper house of parliament, representing Germany's 16 federal states, threw out the legislation, prompting Chancellor Angela Merkel's centre-right government to refer it to a special parliamentary mediation committee.
"The deal is dead, and it is going to stay that way," Norbert Walter-Borjans, finance minister of North-Rhine Westphalia (NRW), told Focus magazine in a report made available on Sunday. He acts as a spokesman for those states opposing the deal.
Championed by Finance Minister Wolfgang Schaeuble, the agreement would have allowed Germany to tax assets stashed away by its citizens in Swiss bank accounts.
The opposition Social Democrats (SPD) and Greens, keen to make taxation of the rich an issue in campaigning for next September's federal election, have argued the legislation would have let off tax evaders too easily.
The deal would have required Swiss banks to levy a punitive charge on an estimated 150 billion Swiss francs ($160 billion) in undeclared funds squirreled away by Germans in Swiss accounts. Future holdings by German citizens would be treated on a par with those held in Germany, although the account holders identities would not be revealed.
(Reporting by Alexandra Hudson)