Austrian Bank Secrecy to be Abolished by 2016
EU Commissioner Algirdas Semeta recently stated that bank secrecy in Austria will expire since by then the automatic exchange of information will be implemented as a standard.
Austrian Bank Secrecy to be Abolished by 2016 / Picture: © Wikipedia / Valsts kanceleja/State Chancellery
This means for Austria that from January 1, 2016 the Austrian bank secrecy is a thing of the past. At the same time Semeta forces Switzerland to cooperate in terms of automatic information exchange.
The G20 finance ministers already decided upon the automatic exchange of information on a global basis, which is a step towards abolishing bank secrecy in Austria. All EU member states – except Austria and Luxembourg – already have implemented IT systems that support the automatic exchange of information.
According to Semeta, he has a clear support of all EU heads of governments in order to expand the EU-wide taxation of saving (EUSD), which is expected to be decided in March 2014.
However, Austria and Luxembourg make their decision depended upon the negotiations with Switzerland. The EU Commissioner regards that there is great progress in the negotiations with Switzerland, Liechtenstein, Andorra, San Marino und Monaco – territories that are highly known as tax havens. Moreover, Semeta assures that convincing reports will be presented at the finance minister conference. Due to the guideline of administrative cooperation, there will be an instrument that meets international standards of OECD. At the moment 42 nations are committed to implement the standards – one of them is Luxemburg. Semeta expects Austria to appear on this list soon.
Semeta also joins the negotiations of an EU-wide standardized Common Consolidated Corporate Tax Base. A consistent calculation basis will stop tax avoidance of multinational corporations. Internal transfer prices would be non-existent, which is an integral part of the profit shifting from high-tax to low-tax countries.
Ultimately, the Country-by-Country Reporting (CBCR) for tax transparency is regarded as promising by EU Commissioner Semeta. The aim of this plan is to commit corporations to disclose their earnings, subsidies and taxes for every country, they operate in. Semeta feels confident that the EU will support CBCR in order to increase tax transparency within the union.
Only two weeks ago Finance Minister Michael Spindelegger expressed his willingness to cooperate in the exchange of information about bank accounts of foreigners to tackle international tax evasion. However, he stressed that Austrian citizens should be able to consider their bank accounts as secret. “This means that it is none of the state’s business but only the business of the Austrian bank client and the bank itself and that is final”, Spindelegger said. The spreading of information about bank accounts of foreigners “is something completely different than the Austrian bank secret,” Spindelegger announced. Both Austria and Luxembourg have been refusing disclosure of information to other EU member states.