The European Union and Switzerland on 27 May 2015 signed an agreement on the automatic exchange of financial account information, aimed at improving international tax compliance.
The agreement represents an important step in ongoing efforts to clamp down on tax fraud and tax evasion. It upgrades a 2004 agreement that ensured that Switzerland applied measures equivalent to those in an EU directive on the taxation of savings income.
Under the agreement, the EU and Switzerland will automatically exchange information on the financial accounts of each other's residents, starting in 2018. The aim is to address situations where a taxpayer seeks to hide capital representing income or assets for which tax has not been paid.
The text was signed in Brussels:
The signature took place in the presence of Pierre Moscovici, commissioner for economic and financial affairs, taxation and customs, who also signed the document.
"Today's agreement shows that the EU's member states and Switzerland are not only politically committed to promoting fair competition in taxation together. We also share the aim of improving international tax compliance on the basis of a reciprocal automatic exchange of information on accounts held by financial institutions", said Mr Reirs.
The agreement ensures that Switzerland applies strengthened measures that are equivalent to the EU directive, as upgraded in March 2014. It also complies with the automatic exchange of financial account information promoted by a 2014 OECD global standard.
There are provisions intended to limit the opportunities for taxpayers to avoid being reported to the tax authorities by shifting assets or investing in products that are outside the scope of the agreement. Information to be exchanged concerns not only income such as interest and dividends, but also account balances and proceeds from the sale of financial assets.
Tax administrations in the member states and in Switzerland will be able to:
The EU and Switzerland must now conclude the agreement in time to enable entry into force on 1 January 2017.