Swiss Bankers Say Government Is Too Complaisant

by Ulrika Lomas, Tax-News.com, Brussels

11 March 2005

Speaking at a Swiss Bankers Association press conference on Thursday, SBA Chief Executive Urs Roth complained that the government had rushed into adopting new FATF money-laundering rules without adequate consideration.

"Even a brief perusal shows that things have been rushing along very quickly and without adequately considering the economic impact," he said. In particular, Roth criticized the FATF's plan to define insider trading or price manipulation as 'predicate offenses' to money-laundering. 'In general', he said, 'we need to be careful that we don’t end up
with a situation where every offence is classified as a predicate offence to money laundering just to satisfy the political agenda of certain states. Originally, the plan was to include only those offences that are attributable to organised crime. This rarely applies to stock market offences due to the transparent nature of stock market trading.'

Roth said that Switzerland was ready for the introduction of the EU's Savings Tax Directive on 1st July, although he said that many of the member states were not by any means equally prepared. Roth explained what had been involved on Switzerland's part: '(The Directive) applies, as we know, only to interest and not to other forms of capital income. Furthermore, it only affects private individuals, but not companies and legal entities. In addition, the savings tax applies only to those persons liable for tax in an EU country, and even then only if the interest income in question is paid or credited across borders.'

'The implementation costs for Swiss banks are estimated to be some CHF 300 million,' said Roth. He added that in terms of revenue to be generated by the tax , because of the directive's limited scope, low interest rates and the initial withholding tax rate of 15%, no "fiscal miracle" should be expected.

Alongside the conference, the SBA issued its annual survey of public opinion regarding the banking sector. This year’s survey reveals that Swiss citizens are very satisfied with their main bank: 79% say they have a “positive” or “very positive” opinion of the financial institution with which they carry out most of their banking business. The results also show that the banking sector in general is held in high regard. Bank-client confidentiality continues to enjoy the strong support of the Swiss people, with an overwhelming majority of 78% saying it should be maintained (2004: 76%). Furthermore, 74% say bank-client confidentiality should not be given up because of international pressure (2004: 72%). reliably identified. An overwhelming majority of 91% (2004: 88%) say that information about a bank client’s financial affairs must be protected vis-à-vis third parties.

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