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Swiss finance minister expects deal on German tax evasion to succeed
September 16, 2012 / 11:51 AM / 5 years ago

Swiss finance minister expects deal on German tax evasion to succeed

ZURICH (Reuters) - Switzerland’s finance minister is confident a deal to tax German assets stashed in the country will go ahead, despite calls by Germany’s opposition Social Democrats (SPD) to scupper the agreement because it is too lax in tackling tax evaders.

Switzerland and Germany hammered out a new deal in April to confront tax evasion, but SPD members have said they will block it in the upper house of parliament.

“I still think that we can manage it. But it will be difficult,” the minister, Eveline Widmer-Schlumpf, told the Sonntag newspaper in an interview.

“German Chancellor Angela Merkel and Finance Minister Wolfgang Schaeuble are campaigning for the cause and holding lots of talks.”

Schaeuble told the German lower house of parliament last week that he thinks the deal is as good as it can get.

Merkel and Schaueble hope the SPD-led states will ultimately cave in, lured by the prospects of billions of euros in much-needed cash.

Norbert Barthle, the budget expert for Merkel’s Christian Democrats (CDU), last week cited estimates Germany could rake in around 10 billion euros ($13.15 billion) from the deal.

But former German Chancellor Gerhard Schroeder said he did not expect the current tax deal to get a majority in the upper house.

“There will have to be new talks,” he told Sonntag in a separate interview. “These will revolve around how to pass on information about people that have moved their money from Switzerland to third countries.”

One of the SPD’s criticisms has been that, as it stands, the agreement would allow people to evade taxes by taking their money out of Switzerland before the deal takes effect. They also object that it would let German account holders remain anonymous.

Widmer-Schlumpf criticized the SPD for turning the deal into a topic ahead of federal elections next year, saying they should look at the deal “unemotionally.”

She said many tax receivables lapse in 2013, making a case to ratify the deal before the end of this year.

Banking secrecy is key to Switzerland’s $2 trillion offshore wealth management industry. It has refused an automatic exchange of information on account holders and is pursuing instead the strategy of a withholding tax to preserve secrecy.

Reporting by Caroline Copley; Editing by Anthony Barker

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