Tax Deal: US Leads the Way for Europe

America has stormed the Swiss banking fortress in just a few months, and with that, has done what Europeans can only dream of. Earlier this year, under pressure from Washington, the government in Bern had to agree to practically give up their banking secrets and thereby allow U.S. investigators access to tax evaders. Their next strike came on Thursday night: Swiss banks that want to avoid prosecution were ordered to pay billions of dollars in fines.

All of the negotiations between Brussels and Bern have to this point added up to a porous agreement, which anonymously taxes Swiss interest income in foreign accounts and transfers three quarters of this amount abroad.

America’s success in this area is due to multiple factors: After the outbreak of the [economic] crisis, the citizens elected a senate and a president who have actively addressed tax evasion. Numerous prosecutions, like the one against UBS for example, have stirred up public interest in the topic. But American success is mostly due to the fact that the U.S. government can speak with one voice. In the EU, on the other hand, Austria is defending the tax haven wherever possible, thereby keeping the EU from pressuring the Swiss. The fact that so far it hasn’t occurred to any opposition party to address this in the election campaign is a crying shame.