Switzerland Reports Jump In EU Withholding Tax Revenues
The Swiss government announced on Thursday that gross revenues collected from interest
payments under the European Savings Tax Directive increased substantially between
2006 and 2007. The Federal Department of Finance revealed this week that tax withheld on
interest payments in Switzerland on earnings liable to tax in the EU increased
from CHF536.7mn (EUR331mn) for the year 2006 to CHF653.2mn for the tax year 2007. On 31st March, 2008, the payment deadline expired for EU tax retained from
individuals resident in EU member states on interest payments made by Swiss
paying agents during the course of 2007. The agreement on the taxation of savings income with the European Community,
in force since 1st July, 2005, makes provision for 75% of the proceeds to be
passed on to the member states concerned. The remaining 25% is kept by the Swiss
government, although 10% of this is passed on to the cantons. Accordingly, CHF489.9mn
in withholding tax revenues was transferred to EU member states, and CHF163.3mn
was kept by Switzerland, out of which CHF16.3 was passed on to the cantons. The Swiss figures show that, of the withholding tax revenues transferred to
EU member states, the largest amounts were passed to Germany (CHF130.5mn), Italy
(CHF125mn), France (CHF61.9mn) and the UK (CHF40.2mn). In addition, the agreement on the taxation of savings income makes provision
for the recipients of interest payments to choose between the system of tax
retention and a voluntary declaration to the tax authorities. Overall in 2007,
in the region of 63,000 declarations were received. Approximately 55,000 declarations
were received in 2006. A comprehensive report in our Intelligence Report series examining offshore confidentiality 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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