February 12, 2009 - Phil Hodgen

Swiss bank secrecy–which way is the tide running?

The Tax Justice Network blog has a guest post from Andreas Missbach of the Berne Declaration about the latest developments in the USA vs. Switzerland spat about Americans with money at UBS.

(The USA wants the Swiss bank to cough up information about American citizens with money hidden at UBS. UBS cried “Can’t do, against the law in Switzerland” and the diplomatic pushing and shoving commenced.)

At a surface level, bank secrecy in Switzerland depends on a nuance–is the claimed offense merely tax evasion or something more? Mere tax evasion isn’t enough for Swiss law to allow a bank to reveal private information.

The guest post reveals the latest developments, and it is clear that the pushing and shoving isn’t over. Whether the Swiss government will fold or not is up in the air. It is a multi-dimensional game of internal Swiss politics (the existence of the Berne Declaration is evidence of an anti-bank secrecy constituency–size and clout unknown–in Switzerland), economics (it is self-evident that banking and related services are a huge part of the Swiss economy), and diplomacy.

The game isn’t over yet. Taking the short view, secrecy will probably erode slowly. Over the long haul, secrecy is a mug’s strategy. Keep it legal, keep it sane. You can do just fine.

Of all the places in the world, I like going to Switzerland the most. I highly recommend spending a few days in Mürren.

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