EC presses for automatic information exchange with third countries

European tax commissioner Algirdas Semeta criticized, in a speech at Leuven in Belgium on 16 November 2010, EU member states that have made bilateral tax information exchange agreements with third countries.

His comments followed the recent agreements made by the UK and Germany to pursue deals with Switzerland. Under these agreements, the Swiss government will not routinely disclose information about British and German taxpayers, but instead will impose a withholding tax on assets they own in Switzerland.

Commissioner Semeta insisted that the Commission will be satisfied only when "close neighbour" third countries, particularly Switzerland, agree to exchange taxpayer information automatically with all EU countries, as specified in the EU Savings Directive.

He said it was logical to expect close neighbours to cooperate more closely with the EU on the exchange of information. "It is not sufficient that individual EU member states conclude bilateral agreements with third countries which provide for the OECD standards of transparency and exchange of information," he said.

"It is much more interesting for a tax authority to receive comprehensive information about the assets owned by its residents abroad than to receive only a withholding tax on the income produced by such assets [which] does not allow Member States to assess the overall tax base of their residents."

Semeta said he expected EU Finance Ministers to reach a political agreement on the Commission's proposals for administrative cooperation "very soon".

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