Thursday, August 18, 2011

France stands up to Swiss dodging

Who are the surrender monkey now? While the German and United Kingdom governments seem to be caving in to Swiss attempts to retain banking secrecy (see here), the French government is resisting similar approaches: "ce n'est pas envisageable" according to this report in Le Monde, which has spoken to the ministers for the economy and the budget.

So what's going on? The Swiss have offered to impose a withholding tax on the interest earnings of British and German residents and to pay the revenues direct to London and Berlin respectively. In return, Swiss bank's clients will retain their anonymity (and continue to dodge inheritance and similar taxes), and Swiss bankers will be allowed immunity from investigation and prosecution for assisting with tax evasion. No matter which way you look at this arrangement, it stinks, and the French government (remember the Presidential elections are on the horizon) probably senses the level of public outrage at such dodgy dealing.

So instead of conceding to the Swiss, the government in Bercy has hit out at making concessions to Berne: the deals being done with Berlin and London "pose problems of principle" which will undermine attempts to tackle tax evasion and "contradict the political efforts of recent years."

They do indeed, but why are the Brits and the Germans so unprincipled, especially during this period of extreme fiscal crisis in Europe as well as elsewhere? After all, the US hasn't caved in to the Swiss, and the French are holding the line. Whilst its tempting to suggest that ending banking secrecy touches too closely on the personal interests of too many political cronies in Berlin and London, our friends in France are far more diplomatic: "We understand the positions of Germany and Great Britain, which not long ago were close to our positions," government ministers are quoted in Le Monde, "but its only human to want to be able to touch the money now rather than later."

Which is a nice way of saying that while others abandon principle for short term expedience, the French government stands up for public interest. Vive la France!



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