Swiss brace for lengthy US tax talks

The Swiss government is bracing itself for protracted negotiations with the United States over undeclared funds stowed by US citizens in Swiss offshore bank accounts, President Eveline Widmer-Schlumpf said. Constant new demands made by US justice officials are the main stumbling block, said Widmer-Schlumpf, who is also Switzerland’s finance minister, in an interview published in weekend editions of a number of Swiss regional newspapers.

The two countries have for years been locked in a conflict over the fact that wealthy Americans are dodging taxes by hiding money in Swiss accounts. Washington is pressuring banks in Switzerland to divulge their names and financial details. Switzerland wants the investigations dropped, in exchange for payment of fines and the transfer of names of thousands of US bank clients. It also wants a deal to shield the remainder of its 300 or so banks from US prosecution.

In 2009, Swiss authorities reached a deal for UBS to pay a fine of US$780 million to avert criminal charges, and ultimately agreed to allow the bank to reveal details of around 4,450 clients. Switzerland also agreed in July to do more to help other countries hunt tax-dodgers following demands from the Organization for Economic Co-operation and Development.