Both Germany and the UK recently signed bilateral tax agreements with Switzerland. Pursuant to the DE-CH agreement, a final withholding tax will be charged on income from savings, investments etc. of German citizens with Swiss accounts (Art. 18). The agreement provides for both a one-off payment for lost income in the past, paid initially by Swiss banks, and an ongoing tax on interest and return on capital. However, the withholding tax will be returned anonymously, thereby protecting Swiss banking secrecy. Other Member States might envisage similar agreements, with France and Spain currently considering it.
1. Does the Commission consider the German-Swiss Tax Agreement, which provides for a withholding tax rate of 26.375% (Art.18), as compatible with the EUSTD and the Agreement between the EC and the Swiss Confederation providing for measures equivalent to those laid down in the EUSTD, which provides for a withholding tax of 35%? Is the credit system provided for in Art. 20 of the agreement sufficient, also in comparison to the UK approach of a 48% withholding tax? Has the Commission been able to evaluate the terms of the agreement reached between the UK and Switzerland and, if so, how does it evaluate the provisions of the agreement?
2. How does the Commission see this agreement affecting the ongoing negotiations on the EUSTD in the Council, and more globally, how does this agreement fit into the proclaimed aim of stronger tax coordination between Member States at EU level? Do the Commission or other Member States regard the agreement as an obstacle to the progress of the EUSTD development? What action will the Commission take to defend the provisions of the EUSTD and make progress with its revision?
3. Do the Member States have the competence to negotiate such bilateral agreements despite the EUSTD already providing for rules for the same subject matter? Does the Commission consider that it should have a stronger role in the ex ante control of bilateral tax agreements between Member States and third countries? Has the Commission been involved or consulted in the negotiations between Germany/ the UK and Switzerland? Will the Commission seek to be involved or consulted in upcoming further negotiations with other third countries in this context?
4. How does the agreement relate to Art. 26 OECD Model and does it curb the development of automatic exchange of information in tax matters?