Although Switzerland has now put forward detailed proposals for voluntary information exchange coupled with a withholding tax, and previously vociferous objectors such as the UK's Gordon Brown appear to be softening their position on the issue, Switzerland has said that it will only impose the levy if Austria, Belgium and Luxembourg are also made to tax the savings interest of non-residents.

Thus far, the three countries have steadfastly refused to cooperate, but the FT revealed that talks between the Danish EU presidency and the maverick nations took place on Tuesday.

The UK business daily suggested that several options are under consideration in order to break the deadlock, including lowering the rate of the withholding tax, although this is likely to be opposed by EU member states such as France and Germany.

Another alternative could be to offer concessions in other areas, according to the FT, which revealed that:

'The Austrians have already asked other EU governments to prolong restrictions on the flow of heavy traffic through the Alps...[and] Belgium is keen to see progress on other tax issues.'

Although Luxembourg is expected to be a tougher nut to crack, the Financial Times suggested that the jurisdiction's government might choose to give way rather than face being left isolated.