Brussels, 10/04/2013 (Agence Europe) - The announcement by Luxembourg that it will be giving up some of its banking confidentiality by 2015 and the move by five member states to set up their own FATCA in the light of the United States' laws requiring information to be given by banks about US passport-holders' bank accounts abroad, seem part of a growing mood against tax evasion and secret bank accounts in the EU.
The prime minister of Luxembourg, Jean-Claude Juncker, confirmed on Wednesday 10 April that his country would be partially removing banking secrecy on 1 January 2015 by joining the automatic exchange of information scheme with other member states about bank accounts opened in Luxembourg by passport-holders of other EU member states (see EUROPE 10822). Banking secrecy will continue for Luxembourg passport-holders' accounts in Luxembourg.
On Tuesday, the chancellor of Austria, Werner Faymann, said that Austria would be negotiating similar moves. In the past, both countries have refused to abandon banking secrecy and rejected the automatic exchange of bank account information laid down in the revised savings tax directive.
In a joint letter to the European Commission, Germany, Spain, Italy, France and the United Kingdom say they will be setting up a joint exchange of tax information system based on the FATCA agreement the five countries have made with the United States. FATCA came into force in 2010. It requires banks everywhere in the world to automatically provide information to the US government about bank accounts and assets of more than US$50,000 owned by US taxpayers in their countries. The penalties for failure to comply can go as high as 30% of any bank transfers from the US to said banks. The five EU nations want to introduce something similar and invite other member states to join them, hoping the move will extend to elsewhere in the world. They say they are setting up a pilot project to locate and catch tax fraudsters that will be a model for wider, multilateral deals.
Welcoming the idea, the European Commission says the draft changes to the savings tax directive, on hold since 2008, and the draft directive on administrative cooperation should be adopted urgently to allow automatic exchange of bank information. It wants a negotiating mandate for tax negotiations with tax havens, including Switzerland, a mandate that Luxembourg and Austria have been vetoing at the EU Council of Ministers. (FG/transl.fl)