Swiss subterfuges continuing to fool Italian politicians?

   0   0 Blog
churchill

From the-best-of-both-worlds.com

This zombie just won’t die. From BusinessWeek:

“Solving the dispute over undeclared Italian funds with Swiss banks will be on the agenda today as Switzerland’s Eveline Widmer-Schlumpf and Italy’s Fabrizio Saccomanni meet in Bern.”

For some time Italy and Switzerland have been talking about signing one of those corrupt “Rubik” deals, where criminal tax evaders get immunity and ongoing secrecy, in exchange for paying withholding taxes on past and future income.

Given how trustworthy the Swiss banking industry is, it’s hardly a surprise that these agreements are useless. In 2011 we told Britain’s tax authorities that they would get a tiny fraction of what they’d forecast from those deals – and we were absolutely spot on.

Let’s now have a look at the numbers being examined in this story.

“While no official numbers exist, Italians may have hidden some 185 billion francs ($206 billion) in Swiss accounts, according to a 2009 report from Helvea SA, a Geneva-based brokerage. That report estimated undeclared U.K. assets of 60 billion francs and 18 billion francs of Austrian funds.”

So let’s apply the Rubik principles, and the general tax rates and terms that have been applied to date by the two countries that have signed the deals.

UK

  • Capital taxes for regularisation of past tax evasion: 25% average – CHF 15 billion
  • Annual tax at least 1 or 2 billion

The end result? The figures to date are less than five percent of that. The other 95 percent escaped not so much by ‘moving the money out of Switzerland,’ but by using weaselly structures such as discretionary trusts. A tax adviser told TJN: “I haven’t heard one complaint from any trustee on how Rubik has or has not affected their business.”

Austria

  • Regularisation of past assets 25 percent average, or 4 billion
  • Annual tax: at least 500 million

Total figures are less than 20% of that, escaped mainly via foundations.  Austria, which is one of the tax havens in Europe that has been fighting hardest to preserve financial secrecy for wealthy individuals, declares (or course) that it is very satisfied with the results.

And so the bandwagon rolls on.

But there’s also this:

“In addition to the Italian talks, Widmer-Schlumpf also is seeking an agreement with Greece and will be meeting that country’s finance minister on Feb. 4 in Athens.”

We have, in fact done detailed analyses of the mooted Swiss-Italy and Swiss-Greece Rubik deals. Click here to see the reports.


Related Posts

New research on key role major economies play in global tax avoidance

offshore-network_colorcorrectedAn important new study on Offshore Financial Centres (OFCs) from the University of Amsterdam has made some fascinating discoveries, challenging, as the Financial Secrecy Index has, the popular misconception that tax havens are only palm fringed little islands and exposing that in fact major economies play a key role in global tax avoidance. Specifically they’ve […]

READ MORE →

Launch of international research collaboration, #AltAusterity

alt austerityToday is the launch of #AltAusterity, a new, international research collaboration of which Tax Justice Network is a partner.  The project aims to stimulate public debate on the subject of austerity though high quality research. It is a response to the lack of evidence which has underpinned the current policy agenda on austerity. The project […]

READ MORE →

RB tax avoidance – company calls for public country by country reporting after Oxfam report reveals profit shifting

pictureOxfam has today released a report on tax dodging by RB, the company formerly known as Reckitt Benckiser and the maker of thousands of well known household products. The report looks at the 2012 restructuring of the company which saw it set up ‘hubs’ in the Netherlands, Dubai and Singapore, all well known corporate tax […]

READ MORE →

Half measures mean Mauritius will continue to be a tax haven for the developing world

MauritiusThere was news this week that Mauritius has signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). This is an initiative from the OECD to allow countries to take measures designed to stop tax avoidance by multinational companies and put them into their existing network of […]

READ MORE →

G20: Pressure rising on tax haven USA

HamburgWhilst the eyes of the world focused on the isolation of the US from the ‘G19’ position on climate change, something remarkable played out elsewhere in the process. Following closely the common EU position that we highlighted a few days ago, the G20 communique devotes important space to tax justice. It’s so good we quote […]

READ MORE →

About The Author

Nicholas Shaxson is a journalist and writer on the staff of Tax Justice Network. He is author of the book Poisoned Wells about the oil industry in Africa, published in 2007, and the more recent Treasure Islands: Tax havens and the Men who Stole the World, published by Random House in January 2011. He lives in Berlin
View all posts by

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to Top