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Tax havens under pressure at G-20

Tax havens under pressure at G-20

An international economic group has put Switzerland, Austria and Luxembourg on a new blacklist of uncooperative tax centers that should be discussed by world leaders at the upcoming G-20 summit in London, an official who has seen the list said Wednesday.
In preparation for the meeting of world leaders, France and Germany asked the Organization for Economic Cooperation and Development to produce a list of countries deemed uncooperative in exchanging banking information, and to propose a range of sanctions.
The 30-country economic forum is recommending levying a withholding tax on transactions destined for tax havens or imposing onerous reporting and auditing requirements on people doing business with those countries, the official said. He declined to be identified because the list is still subject to discussion by G-20 leaders.
The list, which includes around 30 countries, may increase pressure on countries to end banking secrecy.
European leaders, led by France and Germany, are using the global financial crisis to renew efforts to regulate tax havens, which have been accused of allowing banks to conceal losses and hedge funds to avoid regulation.
Switzerland, where banking secrecy is written in law, is under pressure as its largest bank, UBS AG, is in a showdown with Washington over wealthy American tax evaders. Last week U.S. Treasury Secretary Timothy Geithner said President Barack Obama will move to limit wealthy Americans' ability to use tax havens to avoid taxation.
Andorra, Liechtenstein and Monaco also appear on the blacklist, the official said.
The list, which has been sent to Britain, the summit host, includes Hong Kong and Singapore, but their governments recently announced their intention to comply with the standards of the Organization for Economic Cooperation and Development, the official said.
Germany has been pushing for new European Union rules to make it harder for people with large savings to avoid taxes ever following revelations that current loopholes allowed German businessmen to hide millions of euros from tax authorities.
But divisions within Europe on banking secrecy have long frustrated efforts to stamp out tax fraud.
Luxembourg, Belgium and Austria, which have banking secrecy laws similar to those in non-EU members Switzerland and Liechtenstein, have been hesitant to adopt EU rules on forwarding account details to other EU tax authorities for fear of losing banking business.


Updated : 2021-07-26 09:32 GMT+08:00