With stunning speed, offshore wealth
centres ranging from Switzerland to Singapore have made concessions
on banking secrecy – a principle which has long been targeted by
the OECD group of nations determined to stamp out tax evasion.
The US led the attack, demanding UBS release
the names of 47,000 Americans suspected of opening secret accounts
to evade taxes. The new requirement followed UBS’s agreement last
month to release client information on 250 US citizens and pay a
$780 million fine as part of a settlement. Further pressure was
heaped on the tax havens when the issue of blacklisting certain
jurisdictions was placed on the agenda of the G20 summit due to be
held in London on 2 April.
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In rapid succession, Austria, Luxembourg and
Belgium joined Switzerland, Hong Kong, Singapore and Monaco in a
worldwide agreement to exchange tax information on request and
subscribe to the OECD principles on the exchange of tax
information.
Angel Gurría, OECD secretary general, said
international pressure had sparked a “dramatic transformation in
just a few days” in the drive to combat tax evasion.
Still, signs are there will be no sudden
opening up of the whole offshore banking system, estimated to hold
assets of about $7 trillion.
Progress could be slow
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By GlobalDataSwiss finance minister Hans
Rudolf-Merz warned implementing changes to banking secrecy rules
will not happen overnight, particularly as more than 70 double-tax
treaties would have to be renegotiated. Michel Dérobert, secretary
general of the Swiss Private Bankers Association, said Switzerland
would not cave in completely to outside demands on
transparency.
Finally, a US Treasury official has criticised
a controversial list of 50 tax havens which could form the
centrepiece for potential economic sanctions. Part of the list is
included in the Levin Bill, now before both chambers of Congress,
and which aims to place the burden of proof for tax avoidance on
taxpayers.
• See No endgame despite
concessions for full analysis
