Monday

18th Dec 2017

EU commissioner blasts bilateral tax deals with Switzerland

  • Swiss francs have gone up in value during the euro-crisis (Photo: Marcel Grieder)

Member states should "refrain" from bilateral deals on taxing Swiss bank accounts held by their nationals, EU taxation commissioner Algirdas Semeta on Monday (5 March) wrote in a letter to the Danish EU presidency.

The letter, seen by EUobserver, was prompted by the recent signature by Germany and the UK of bilateral agreements with Switzerland in the area of taxation and financial markets.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

"While member states are free to enter into international agreements, be they bilateral or multilateral, such agreements must not include any aspects which overlap with areas in which common action by the European Union has been taken or is envisaged," Semeta wrote.

A long-delayed revision of an EU savings law, which is still being blocked by Austria and Luxembourg, would widen disclosure requirements to bank accounts held by EU nationals abroad - for instance German and British nationals not paying taxes back home on their Swiss accounts.

"In this context, member states should refrain from negotiating, initiating, signing or ratifying agreements with Switzerland, or any other third state, insofar as any aspects regulated at EU level might be touched upon," the letter reads.

Germany and the UK have since agreed to re-negotiate the agreements and remove these provisions, but Bern has threatened to block other EU-Swiss agreements under way in retaliation. Switzerland is thought to view bilateral tax deals easier than having to deal a potentially more demanding EU pact.

Speaking at a press conference in Brussels on Monday, Semeta said he was "always in favour of a constructive approach in negotiations and I trust this will be the case."

"We have our reading of the agreements which says very clearly they have to be changed and that is what Germany and the UK are ready to do. It is up to Switzerland to decide what they will do, but I do not think we should take hostage other agreements currently being negotiated."

The commissioner, who wants to prevent other countries taking the London and Berlin route, also noted that over €1 trillion are lost yearly in the EU due to tax evasion and fraud, "a lot" given the current economic crisis. By unblocking the EU savings law, member states would be able to boost their revenues and make less painful cuts in the wages or pensions sector, he said.

Semeta's stance is backed by one of the key MEPs dealing with this dossier, British Liberal MEP Sharon Bowles who chairs the economics committee.

"When I first heard the proposal by Angela Merkel (on the bilateral agreement with Switzerland), my reaction was 'oh no' and it has not changed since," she said during the same press conference.

She insisted that bilateral deals can never be better than EU-wide agreements and said all member states should benefit from transparency and disclosure rules with Switzerland. "I believe in the supremacy of the community method," she said.

This article was corrected on 6 March to say that over €1 trillion are lost yearly due to tax evasion and fraud, not €3 trillion as it previously stated.

France threatens Switzerland on tax evasion

French leader Nicolas Sarkozy has promised to make Switzerland into an international pariah unless it stops helping EU tax payers hide money. But EU countries have a poor track record of cracking down on high-level cheats.

EU set to probe Ikea tax affairs

Swedish founded furniture retailer Ikea has reportedly been targeted by the European Commission, which is set to launch an investigation into how tax schemes in the Netherlands allegedly enabled it to avoid paying into public coffers.

Analysis

EU mulls post-Brexit balance of euro and non-eurozone states

Brexit will dramatically change the balance between EU members states that have the euro and those that don't. The thinking on the future of the eurozone is done at EU-27 level - but opposing camps will have to be reconciled.

Stakeholders' Highlights

  1. Dialogue PlatformThe Gülen Community: Who to Believe - Politicians or Actions?" by Thomas Michel
  2. Plastics Recyclers Europe65% plastics recycling rate attainable by 2025 new study shows
  3. European Heart NetworkCommissioner Andriukaitis' Address to EHN on the Occasion of Its 25th Anniversary
  4. ACCACFOs Risk Losing Relevance If They Do Not Embrace Technology
  5. UNICEFMake the Digital World Safer for Children & Increase Access for the Most Disadvantaged
  6. European Jewish CongressWelcomes Recognition of Jerusalem as the Capital of Israel and Calls on EU States to Follow Suit
  7. Mission of China to the EUChina and EU Boost Innovation Cooperation Under Horizon 2020
  8. European Gaming & Betting AssociationJuncker’s "Political" Commission Leaves Gambling Reforms to the Court
  9. AJC Transatlantic InstituteAJC Applauds U.S. Recognition of Jerusalem as Israel’s Capital City
  10. EU2017EEEU Telecom Ministers Reached an Agreement on the 5G Roadmap
  11. European Friends of ArmeniaEU-Armenia Relations in the CEPA Era: What's Next?
  12. Mission of China to the EU16+1 Cooperation Injects New Vigour Into China-EU Ties

Latest News

  1. Far-right enters government in Austria
  2. UK should work more closely with MEPs on Brexit
  3. EU set to probe Ikea tax affairs
  4. Estonia's last chance to land green energy results
  5. Catalonia, Brexit, and Uber on EU agenda This WEEK
  6. Macron and Merkel take tough line on Poland
  7. Eurozone future needs structural reforms, EU leaders told
  8. Showdown EU vote on asylum looking likely for next June