Brussels, 30/07/2012 (Agence Europe) - On Thursday 26 July 2012, the United States and five European countries (Germany, France, the United Kingdom, Italy and Spain) announced the introduction of a model agreement for the automatic exchange of information about foreign bank accounts, following the February 2012 agreement on tackling tax evasion (see EUROPE 10550). In a press release, the six countries said they were now awaiting the signature of the bilateral agreements, based on the model agreement, and hoped they would be signed by other countries too.
Under these tax agreements, European signatory countries agree to introduce the United States FATCA law on meeting tax obligations for foreign tax accounts (see EUROPE 10403) by forcing banks to automatically provide information about assets owned by foreigners to the tax authorities of the countries concerned. To date, tax agreements have only required information to be provided upon demand to a country suspecting that one of its residents is avoiding tax.
At the end of June 2012, Switzerland said it was prepared to comply with FATCA, although in the past, it always refused to provide details of bank accounts to EU27 countries. Switzerland has signed one-off tax deals with the United Kingdom, Germany and Austria to enable the three countries to recuperate a proportion of lost tax revenue from bank accounts in Switzerland opened by residents of the countries in question, but in return, Switzerland is keeping the identity of the account-holders confidential. Switzerland's agreement to comply with FATCA and the spread of the automatic exchange of information model in Europe may pave the way for resolution of the tricky savings tax question in Europe. Revision of the savings tax directive and the issuing of a negotiating mandate to the European Commission to update EU tax agreements with Switzerland and other tax havens are in deadlock because of opposition from Austria and Luxembourg. (FG/transl.fl)