Report Suggests Billions Of Euros Returned To Italy As Result Of Tax Amnesty

by Philip Morton, Investors Offshore.com

17 May 2002

According to Swiss bankers following the expiry of the Italian tax amnesty on Wednesday, although billions of euros are thought to have been repatriated from Swiss bank accounts, the amount represents just a fraction of the assets still held by Italians in the Alpine jurisdiction.

A report from the Swissinfo news service on Wednesday suggested that the SFr45-50 billion (30-35 billion euros) removed from Swiss bank accounts since the amnesty began in November probably accounts for around 10% of the total assets deposited by Italians in Switzerland.

Those who chose to take advantage of the tax amnesty, which had originally been scheduled to end in February, but was extended due to a sluggish response, were afforded partial immunity from the country's tax evasion legislation, with penalties limited to 2.5% levied on the gross amount deposited in the account.

Although not overly concerned about the possibility of an exodus, several Swiss banks implemented an 'onshore' strategy, opening branches in Italy in order to retain customers returning assets to their home country.

Several other European governments are rumoured to be considering implementing similar schemes, according to Swissinfo, which cited Spain and Belgium as examples.

However, despite being one of the leading repositories for the assets of Europe's high net worth individuals, the Swiss banking sector appears confident that the relatively low-key response demonstrated by the Italians will be replicated in any other such experiments.

'Foreigners invest in Switzerland for reasons other than avoiding tax,' Thomas Suter, spokesman for the Swiss Bankers' Association told the news service. 'Our institutions guarantee stability, competence, and quality.'

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