Tax evasion: EU-Switzerland sign deal 'to end banking secrecy'

The EU and Switzerland have signed an agreement that is intended to clamp down on tax evasion, the European Commission has said.

From 2018, EU residents will be prevented from hiding undeclared income in Swiss banks.

The EU and Switzerland will exchange information on the bank accounts which their respective citizens hold.

The EU Commission said it was a "deterrent" against hiding income abroad.

"This new transparency should not only improve member states' ability to track down and tackle tax evaders, but it should also act as a deterrent against hiding income and assets abroad to evade taxes" the EU Commission said.

The Commission is also negotiating similar agreements with Andorra, Liechtenstein and Monaco.

EU commissioner Pierre Moscovici said that the agreed automatic exchange of information was "another blow against tax evaders and (represents) another leap towards fairer taxation in Europe".

It follows an agreement for "strengthened transparency" made between EU member states last year.

BBC News Services

Switzerland has begun revealing alleged foreign tax dodgers that are wanted by tax authorities in their native countries, Swiss newspaper Sonntagszeitung reported.

MOSCOW (Sputnik) – Names, birth dates and nationalities of people suspected by their countries of origin to have stashed money in the alpine tax haven are being published in Switzerland's official legal paper Bundesblatt. US nationals will be identified by their initials, Sonntagszeitung said.

Swiss authorities said they had been overwhelmed by requests from Germany, Russia, India and the United States to expose suspected tax cheats. German media have been anxious to find Francisco Jose Ortiz von Bismarck, a descendant of Germany's first chancellor Otto von Bismarck, among those under investigation.

According to the Swiss newspaper, the move will allow those wanted by their governments a chance to seek legal aid.

Switzerland has recently been rolling back its notorious bank secrecy after it came under pressure from tax authorities across the world, specifically from the United States.

Since the late 2000s, Washington has been pressuring Swiss banks to provide names of its citizens whose money had been traced to accounts in Switzerland. The US Department of Justice sued the Swiss-based banking firm UBS for hundreds of millions of dollars in 2008 and 2009, and has continually pushed for increased transparency.

Bern is now negotiating a deal with the United States to exchange bank account data in a bid to crack down on tax dodgers. A similar preliminary accord was agreed between Bern and Brussels back in March 2015.

The disclosures come a month after a team of international journalists unearthed secret bank records that showed that the London-based global banking giant HSBC's Swiss branch had made large profits between 2005 and 2007 by helping its clients evade taxes