Clause 218 - Agreement between UK and Switzerland

Part of Finance Bill – in a Public Bill Committee am 12:15 pm ar 20 Mehefin 2013.

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Photo of Catherine McKinnell Catherine McKinnell Shadow Minister (Treasury) 12:15, 20 Mehefin 2013

The clause would amend schedule 36 to the Finance Act 2012, which gave statutory effect to the terms and principles of the UK-Swiss Confederation taxation co-operation agreement, which was signed on 6 October 2011 and has been effective since 1 January 2013. The clause clarifies that certain transfers made to HMRC under the agreement will not give rise to a taxable remittance. The stated purpose of the UK-Swiss agreement is to provide for bilateral co-operation between the UK and Switzerland to ensure the effective taxation in the UK of individuals who have financial assets in Switzerland.

On announcing the agreement in 2011, the Government said:

“The agreement will resolve the long-standing abuse of Swiss banking secrecy by those who seek to conceal the proceeds of tax evasion and is expected to secure billions of pounds of unpaid tax for the UK Exchequer from 2013.”

The Committee that considered last year’s Finance Bill had a passionate debate on the agreement, the principles behind which the Opposition, of course, support. However, the Minister will recall our concern that the agreement is riddled with loopholes and exemptions that could seriously undermine its potential to yield anything near what the Treasury has said it will.