Swiss Finance Minister Eveline Widmer-Schlumpf is baffled by the EU Tax Commissioner's words (Keystone)
In a letter sent on Monday, EU taxation commissioner Algirdas Semeta
stressed that the 27 member states “should refrain from negotiating,
initialling or ratifying agreements with Switzerland” if some of the
countries’ provisions interfere with EU legislation.
“The letter is not addressed to us, and I do not know what Semeta’s
intention was,” Widmer-Schlumpf told Swiss national radio on Tuesday.
She added that previously, the Commission had clearly stated that the
individual nations had the authority to settle bilateral tax matters
independently.
Semeta’s letter was addressed to Danish Finance Minister Margrethe Vestager, whose country currently holds the rotating EU presidency.
Britain and Germany have already signed so-called “Rubik” bilateral tax agreements with Switzerland. (See box at right.) Widmer-Schlumpf said that to her knowledge, neither country had plans for any major revisions.
“Just weeks ago, German Chancellor Angela Merkel said explicitly that she wanted to finalise the accord soon,” Widmer-Schlumpf said on Tuesday.
Semeta’s letter was addressed to Danish Finance Minister Margrethe Vestager, whose country currently holds the rotating EU presidency.
Britain and Germany have already signed so-called “Rubik” bilateral tax agreements with Switzerland. (See box at right.) Widmer-Schlumpf said that to her knowledge, neither country had plans for any major revisions.
“Just weeks ago, German Chancellor Angela Merkel said explicitly that she wanted to finalise the accord soon,” Widmer-Schlumpf said on Tuesday.
Rubik deals
In his letter, Semeta emphasised that the Commission had had “very
constructive discussions” with Berlin and London to ensure that they
“modify” their agreements to render them EU-compatible.
“I am confident that a satisfactory solution will be found,” he wrote, noting that his objective was to prevent other countries from exposing themselves to infringement procedures.
Just last year, the European Commission threatened to take Germany and Britain to court if they enforced the Swiss treaties.
Semeta has since acknowledged that EU member states were free to sign bilateral agreements with Switzerland, on condition that they remain within certain legal limits.
Regarding direct taxes in the future, sectors already covered by EU legislation on savings-generated income taxes must be excluded from the field of application of the Rubik agreements, the Commission letter said.
Regarding the past, the regularisation of hidden assets “cannot cover the tax on value-added tax (VAT),” continued the letter, which also mentioned the concessions that Germany and Britain had made with Switzerland. Both countries have pledged to “facilitate” the access of Swiss operators to their national financial services.
EU members would not be able to compromise in areas that are already covered or could be covered in future by “Community harmonisation”, the letter emphasised:
“The principle of the exclusive competency of the EU vis-à-vis the exterior must be respected [...]. This could also concern banking services and investment services.”
According to the commission, the EU’s unity will give it an edge over Bern. Semeta noted that it was “more important than ever to confer a high priority at the Council” to give the Commission the mandate to renegotiate with Switzerland on savings tax agreements.
“I am confident that a satisfactory solution will be found,” he wrote, noting that his objective was to prevent other countries from exposing themselves to infringement procedures.
Just last year, the European Commission threatened to take Germany and Britain to court if they enforced the Swiss treaties.
Semeta has since acknowledged that EU member states were free to sign bilateral agreements with Switzerland, on condition that they remain within certain legal limits.
Regarding direct taxes in the future, sectors already covered by EU legislation on savings-generated income taxes must be excluded from the field of application of the Rubik agreements, the Commission letter said.
Regarding the past, the regularisation of hidden assets “cannot cover the tax on value-added tax (VAT),” continued the letter, which also mentioned the concessions that Germany and Britain had made with Switzerland. Both countries have pledged to “facilitate” the access of Swiss operators to their national financial services.
EU members would not be able to compromise in areas that are already covered or could be covered in future by “Community harmonisation”, the letter emphasised:
“The principle of the exclusive competency of the EU vis-à-vis the exterior must be respected [...]. This could also concern banking services and investment services.”
According to the commission, the EU’s unity will give it an edge over Bern. Semeta noted that it was “more important than ever to confer a high priority at the Council” to give the Commission the mandate to renegotiate with Switzerland on savings tax agreements.
Uncle Sam
In recent years, Switzerland’s on-going tax negotiations with the
United States have generated more headlines than those regarding the EU.
On Monday, the Swiss House of Representatives followed the Senate in
approving a tax deal with the US – making it easier to hand over
information about US citizens with Swiss bank accounts.
The revised accord allows for administrative assistance to be provided to the US in matters involving grouped requests for information, based on a suspicious “pattern of behaviour” by people or financial institutions.
US tax authorities will not have to provide names or addresses of its suspects in order to receive assistance. The deal will come into effect when the US has agreed to an overall solution of the tax dispute between the two countries.
For the Swiss government, parliament’s “yes” is a key step in solving the dispute, which has affected 11 Swiss banks. Meanwhile, it is not surprising that other countries want to have the same privileges enjoyed by Uncle Sam.
“If the US gets the details of thousands of clients, then Europe will want the same,” pointed out Pierin Vincenz, chief executive of Raiffeisen Switzerland, in a recent interview in the Swiss newspaper Sonntag.
He also criticised the fragmented Swiss response to a variety of threats and demands from the US and Europe, noting that the Swiss government had generally lowered hurdles for handing over client data to foreign tax authorities that were investigating suspected evasion cases.
Speaking on Tuesday, Widmer-Schlumpf was not willing to discuss potential solutions or modifications to the existing deals. Later this month, she and Foreign Minister Didier Burkhalter are due to go to Brussels.
The revised accord allows for administrative assistance to be provided to the US in matters involving grouped requests for information, based on a suspicious “pattern of behaviour” by people or financial institutions.
US tax authorities will not have to provide names or addresses of its suspects in order to receive assistance. The deal will come into effect when the US has agreed to an overall solution of the tax dispute between the two countries.
For the Swiss government, parliament’s “yes” is a key step in solving the dispute, which has affected 11 Swiss banks. Meanwhile, it is not surprising that other countries want to have the same privileges enjoyed by Uncle Sam.
“If the US gets the details of thousands of clients, then Europe will want the same,” pointed out Pierin Vincenz, chief executive of Raiffeisen Switzerland, in a recent interview in the Swiss newspaper Sonntag.
He also criticised the fragmented Swiss response to a variety of threats and demands from the US and Europe, noting that the Swiss government had generally lowered hurdles for handing over client data to foreign tax authorities that were investigating suspected evasion cases.
Speaking on Tuesday, Widmer-Schlumpf was not willing to discuss potential solutions or modifications to the existing deals. Later this month, she and Foreign Minister Didier Burkhalter are due to go to Brussels.
swissinfo.ch and agencies
(With input from Tanguy Verhoosel, Brussels)
(With input from Tanguy Verhoosel, Brussels)
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