Tuesday, October 26, 2010

Britain aligns with Switzerland in defence of secret wealth

We are horrified to see that Britain has surrendered to the interests of big finance and secret wealth, in a new treaty signed with Switzerland. We will blog this at greater length in due course, but for now we will simply cut and paste from Tax Research UK which notes that although we are yet to see the final details, the UK government looks like it has effectively announced an intention to sign a total tax amnesty for UK tax evaders who have used Switzerland, and has, it seems:
1) Granted Switzerland the right to set the effective higher rate of tax on investment income in the UK;
2) Granted Swiss banks an everlasting competitive advantage over UK banksbecause it will pay all higher rate tax payers to bank in Switzerland henceforth;
3) Denied the UK tax authority the right to make enquiries of their own choosing about the tax affairs of a British personthe Swiss now being granted the right to decide how many enquiries may be made and whether they are appropriate or not.
4) Granted criminal immunity to Swiss bakers who sell tax evasion – so allowing them to commit ongoing crime in the UK.
In the process the UK is:
a) Promoting tax evasion by its citizens
b) Promoting Geneva and Zurich over London
c) Abandoning its right to tax
d) Abandoning its rights to enforce its laws
e) Alienating the OECD
f) Abandoning the fights against tax havens.
It is a thorough indictment of the current UK government, which has effectively surrendered on this point.

Update: Tax Journal reports on this, quoting our blog it seems, and adding this nice touch:
"Andreas Kolb, a Partner in the Switzerland office at Eversheds, observed: ‘It is somewhat surprising that the United Kingdom is the first country with which Switzerland has signed a basic agreement on dealing with untaxed money, especially given that the UK’s Channel Islands are known the world over for the legal possibilities they offer in terms of concealing money via trusts. These constructions are often much more confidential than the famed Swiss bank secrecy.’"
The Crown Dependencies will not want to admit it, but Kolb is right, too.

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