In 2014, Switzerland signed up to the Organisation for Economic Cooperation and Development’s (OECD) Automatic Exchange of Information (AEOI) programme.
Under the agreement, Swiss banks are required to share the financial information of offshore clients with more than 100 countries.
Coming clean
In anticipation of the information sharing, newswire Reuters reported that 6,150 taxpayers from Zurich, the country’s largest and wealthiest canton, have voluntarily revealed previously undisclosed assets, totalling CHF104m in 2017.
This figure triples the previous record set in 2016 and the high number means authorities have only been able to handle about half of the cases so far.
In 2010, Switzerland introduced a rule allowing taxpayers to make a one-time only declaration of untaxed assets without facing a fine.
To date, CHF1.3bn (£983m, $1.3bn, €1.1bn) has been disclosed under the rule.
Banker relief
As the old Swiss practice of secrecy continues to erode under agreements like the OECD automatic exchange and Fatca, a recent court decision has allowed some bankers to breath a sigh of relief.
On 3 January, the Switzerland Federal Court upheld a case to stop the handover of Swiss bank employee details to US federal tax investigators.
The case, reported by local news provider Swiss Info, was brought by a US expat in Switzerland who disputed that details obtained from his bank by the Swiss Federal Tax Administration (FTA) could be handed over to US authorities.
The court agreed with the expat, and said the information included third-party individuals who were not relevant to the case. They said the FTA had also not provided a convincing argument that the information was vital in building a case against the evader.
Additionally, the court found, even if third parties were connected to the fraud, their identities should not be requested through administrative assistance channels.
The decision to withhold the information is the latest development in a spate of cases in which US authorities have taken Swiss banks to court to reveal details of tax evaders.
