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Austria Calls Swiss Tax Deal A 'Resounding Success'

by Ulrika Lomas,, Brussels

28 January 2014

Following a meeting with Swiss President Didier Burkhalter, Austrian Vice Chancellor and Finance Minister Michael Spindelegger underlined the resounding success of the bilateral withholding tax agreement concluded between the two countries.

Expressing Austria's "utmost satisfaction" with the tax accord, which entered into force on January 1, 2013, Finance Minister Spindelegger announced that the expected yield from the withholding tax, imposed on the untaxed assets of Austrian taxpayers held in the Confederation, is in line with the initial forecast. Furthermore, expectations may even be exceeded, if revenue flowing from the evaluation of voluntary declarations of non-compliance is taken into account, he explained.

Concluding, Finance Minister Spindelegger made clear that current developments and discussions on an automatic exchange of information will not impact on the treaty, highlighting the fact that the accord focuses on settling past tax liabilities, via the imposition of a flat-rate of withholding tax. This objective could not have been achieved without the agreement, as automatic information exchange can only ever pertain to future tax periods, Spindelegger ended.

Commenting, budget spokesman for the Austrian People's Party (ÖVP), Gabriele Tamandl underscored that it was a good decision to conclude a tax agreement with the Confederation, as the figures prove, noting that since July 2013, Switzerland has transferred around EUR717m (USD982m) to Austria as part of the regularization of assets. This money is very welcome in Austria's budget, she stressed.

In addition, Tamandl urged opponents of the accord and proponents of an automatic information exchange to reconsider their stance, arguing that such a mechanism would have lead to higher administrative costs, while garnering a lower tax take.

The fact that thousands of Austrians, with unreported assets invested in Swiss financial institutions, have elected to complete a voluntary declaration to legalize their wealth before the tax authorities, is further demonstration of the success of the accord, Tamandl noted.

TAGS: compliance | Finance | tax | tax compliance | tax avoidance | budget | agreements | withholding tax | Austria | Switzerland | individual income tax | Tax | Tax Evasion

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