German-Swiss Tax Evasion Deal Blocked in Berlin

[sabaku_no_gaara]

It was supposed to end decades of disagreement between Switzerland and Germany over tax evasion, but on Friday lawmakers in Berlin put a stop to it. The country's upper legislative chamber, the Bundesrat, voted against implementing a long-awaited tax treaty that parliament had already approved.


The conflict between the two neighboring countries on the issue now threatens to continue after members of the opposition Social Democratic Party (SPD) and the Green Party used their majority to block the measure in the Bundesrat, which represents the interests of Germany's 16 states. The issue must now be addressed by the Mediation Committee between the upper and lower parliamentary chambers. But any potential agreement would then have to be re-approved by Switzerland.

The tax treaty, which would have retroactively taxed the unclaimed money held by German citizens in Swiss bank accounts, was expected to bring in about €10 billion ($12.9 billion) in tax revenues. Under the agreement, money stashed in Switzerland over the last 10 years would be taxed at a rate of between 21 and 41 percent, and the tax evaders would remain anonymous. Beginning in 2013, they would then be taxed at normal German rates. But the SPD and Greens said the agreement didn't go far enough.

They voted against the measure despite warnings from Chancellor Angela Merkel's party, the conservative Christian Democratic Union (CDU). The party's General Secretary Hermann Gröhe told daily Neue Westfälische ahead of the vote that their "total refusal" on the issue is "irresponsible" and will cost the country's states billions.

A 'Non-Negotiable' Matter

Earlier in the week during budgetary debates in parliament Finance Minister Wolfgang Schäuble also referenced the states' empty coffers, saying it would be unacceptable if the Bundesrat failed to approve the measure. As claims on back taxes become invalid due to the statute of limitations, billions are being lost, he said. SPIEGEL has learned that the finance minister also offered the states some €3 billion in additional funding if they approved the treaty.

That prompted Peter Friedrich, an SPD member of the Bundesrat from Baden-Württemberg, to accuse Schäuble of trying to buy the state's votes. "Our substantial criticisms haven't been addressed. Instead there is an attempt to whitewash mistakes with money." he told news agency DAPD. "For us, tax fairness and ethics are non-negotiable."

In an interview with radio station Deutschlandfunk, the state of North Rhine-Westphalia's Finance Minister Norbert Walter-Borjans said that Germany must "make clear where the limit is when one side earns its money from another's losses," he said. The state finance minister also criticized Schäuble's calculation that the treaty would bring in billions in new tax revenues, calling it a "lively fantasy."

Despite the Bundesrat's rejection of the treaty, Switzerland, where the treaty has already surmounted parliamentary hurdles, signaled that it would not give up on coming to an agreement on the issue. The Swiss Banking Association also expressed its regret over the Bundesrat decision.

http://www.spiegel.de/international/...-a-868912.html

I don't understand naive idologists, if Germany needs anything, it's money 10 bilion is a good amount of money, and the evaders would be taxed in the future so money would still be pouring in, the evaders would just remain anonymous.

This would have been a fantastic deal but once again greens and socialists prove themselves to be naieve ideologists instead of pragmatic managers of a nation.

Now the Germans will see no money at all, and trying to force the swiss to give up the anonimity of the evaders will take forever giving those guys time to transfer their money to other tax evader havens. Wich will be problematic for the Swiss banking industry.

Have the socialists and Greens forgotten that we Europeans are in a huge crisis and that we really need those bilions?

blöde arschlöcher

[eisenkopf]

The numbers on potential revenue are pure estimates by those who favor the deal, and are thus certainly an upper boundary. Considering that we do not know how much "black money" is with Swiss banks, the actual numbers might turn out much lower. Of course, the German tax collectors are completely at the mercy of the Swiss banks.

This is the first main criticism: Tax evaders remain anonymous, and there is no measure foreseen to control the actions of the Swiss banks.

The second main criticism is justice: With this deal, tax evasion would have been very profitable, because of reduced tax rates for the 10 year period, and none before. And it would remain profitable, because the money would remain undeclared and thus would not appear on any regular tax declaration.

It's hard to NOT see the problems with the deal, and I am strongly opposed to it. Nevertheless, I am sure it would have passed if we wouldn't have federal elections next year, and tax evasion is a nice issue left-of-center parties can exploit.

[sabaku_no_gaara]

Justice is not as important as money if you ask me,

[eisenkopf]

Justice is not as important as money if you ask me,

Oh, great. Well then, enjoy the crumbs you pick up from the floor under the table. I'll continue to try to get my share from what's on the table.

[karo]

Oh, great. Well then, enjoy the crumbs you pick up from the floor under the table. I'll continue to try to get my share from what's on the table.

So how did blocking this agreement help Germany or the German people? To deal with tax evasion you need a pragmatic approach.

[eisenkopf]

So how did blocking this agreement help Germany or the German people? To deal with tax evasion you need a pragmatic approach.

The pragmatic approach is buying more data on tax evaders from whistleblowers. As I said before, there is absolutely no guarantee that the deal would have brought in a lot of money. In contrast, we legitimize tax evasion. How would that help Germany or the German people?

[sabaku_no_gaara]

The pragmatic approach is buying more data on tax evaders from whistleblowers. As I said before, there is absolutely no guarantee that the deal would have brought in a lot of money. In contrast, we legitimize tax evasion. How would that help Germany or the German people?

That is IF whistle blowers sell their data, and that is IF whistle blowers didn't pull the info out of their behind because they know they can make a quick buck scamming the gouverment with selling it some made up information, and IF the purchased info can be used in a court to force the evaders to pay.


If they are prepared to pay a little bit in exchange for anonimity and if all these little bits make one big fat juicy cake, then I see it as irresponsible to not accept, especially in these troubling times.

Legitimizing tax evasion in a way that allows some money to flow into the state coffers is better than combatting tax evasion (wich costs money) and never seeing a single euro cent from the evaders who can transfer their assets from tax haven to tax haven.

The socialists and Greens views in this matter are those of a Naive college kidd and not those of politicians who's most important task is to manage a budget and adapting to the game of realpolitik.

Personally If I lived in Germany I'd never again vote for the Greens or Socialists


There comes a time in life when you realise that: "is this wrong or is this right?" is not the essential question in life but: "will this positively influence my finances or negatively"?

It seems the German socialists and Greens have yet to reach adulthood and realise this.

Justice is not verry important, I don't care to know who evades taxes and who doesn't as long as some money flows to the coffers so others (me!) don't have to be taxed extra to balance the budget, all is well

[karo]

The pragmatic approach is buying more data on tax evaders from whistleblowers. As I said before, there is absolutely no guarantee that the deal would have brought in a lot of money. In contrast, we legitimize tax evasion. How would that help Germany or the German people?

How long will that last or how long until they pick a new destination for their money? The whistle blowers are a short term solution that will not change anything. However this treaty could have been the first step to something concrete in the future. It would have also brought in more tax revenue, right now there is no tax revenue or any plan to solve the issue.
This is a very delicate issue that needs to be solved on step at a time.

[Condottiere 40K]

Statute of Limitations sounds interesting.

[SorelusImperion]

Justice is not as important as money if you ask me

Good god. Not only is it awfully shortsighted but also borderline criminal.
A state that places money above justice is what you have in Russia or in one of the many third world banana republics.

[sabaku_no_gaara]

Good god. Not only is it awfully shortsighted but also borderline criminal.
A state that places money above justice is what you have in Russia or in one of the many third world banana republics.

But we have to keep S&P and Moody's and Fitch happy or we won't be able to borrow money from banks to save the banks who in turn need to be able to borrow money from and to eachother to stimulate local economies, so right now money should be a priority over justice.


Good god that sounds verry sarcastic but I'm honestly not trying to be sarcastic, that is the reality of today.


Here's an example of the crazy situation we are in today:

In France, local gouverments depend on Dexia to borrow them money, Dexia has been forbidden from lending anyone money (wich makes sense concidering they had a loss of 14 bilion € last year, and have no money at all, only a huge pile of debt and a bunch of toxic loans) So Dexia informed the French local comunities that they won't be lending them any money as the EU forbids it. The French local gouverments in turn panicked because no Dexia loans means no money for just about everything a local gouverment does and thus they went to court to have a judge Force Dexia to loan the local gouverments money. Money that it doesn't have...

[Big War Bird]

No deal that does not also get reparations from the Swiss state for aiding tax evaders if you ask me.

German strategy ought to be to offer reward and citizenship to Swiss banking personnel that report tax evaders to German investigators.

Of course I'm not sure German citizenship would be worth much to a Swiss.

[Thorn777]

And be poorer tomorrow since all them richies now know you can go Switzerland without problems and pay 10-20% less in taxes?

This is a crappy deal for Germany. A good one for elites and switzerland. Its a most important subject though, and we need to crack this nonsense down. 10 billion is nothing to the estimated 400 billion of evaded German money there.

Being real about matters like this is the only way forward out of this crisis, also for Greece for instance. This deal would simply mean that we have to shut up for the coming 10 years and take the change and smile like a good bum.

Lots about this deal, other deals and the matter as whole is found in this vid series of 9:



So plz stop calling the opponents naive socialists etc. I get you get the idea, since the crappy OP article doesnt even really express why they are against it. Lamestream presstitution is what makes naive.

[Col. Tartleton]

When France, Germany, Italy, and Austria unify they ought to overthrow Switzerland.

[Condottiere 40K]

I doubt that the Swiss have ever really feared a threat to their southern and eastern flanks, outside of the Russians. Unless Sarkozy actually turns out to be Napoleon, and not just have his ambitions, they have little to fear from the west, and the Swiss generally agree to disagree with the Germans, having realized that Schwabia was beyond their effective reach.

[Col. Tartleton]

I doubt that the Swiss have ever really feared a threat to their southern and eastern flanks, outside of the Russians. Unless Sarkozy actually turns out to be Napoleon, and not just have his ambitions, they have little to fear from the west, and the Swiss generally agree to disagree with the Germans, having realized that Schwabia was beyond their effective reach.

I was saying when/if the EU crystallizes into a Federation they can exert extreme pressure on Switzerland to enter the Federation.

[Condottiere 40K]

If.