Swiss Banks To Face Greater Competition Says SNB Chief
Swiss banks will be thrown open to greater competition as a result of the European
Savings Tax Directive, due to enter into force in July 2005, according to the
Swiss National Bank President Jean-Pierre Roth. Because Switzerland's participation in the agreement will mean that it will
levy a withholding tax on individuals' interest income, Roth told a business
conference in Milan on Tuesday that: "this means Swiss banks will face
increased competition." Initially, the Savings Tax Directive (STD) aimed at a uniform 'information
exchange' regime to apply across the Union, with all countries agreeing to report
interest on savings paid to the citizens of other Member States to those States'
tax authorities. However, as a result of resistance from EU Member States with strong traditions
of banking secrecy, the European Commission had to allow Switzerland, along
with Austria, Luxembourg and Belgium to apply a withholding tax at 15% until
2009. In addition, many of the UK's offshore financial centres have been forced to
join the STD, along with the Netherlands Antilles, Aruba and some European centres
including Andorra, Monaco, Liechtenstein and San Marino. Most of these places
will also take the withholding tax route. A comprehensive report in our Intelligence Report series examining offshore confidentiality and multilateral initiatives such as the European Savings Tax Directive is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report1.asp
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