EU commissioner calls for an end to Austrian banking secrecy

EU Taxation and Customs Union Commissioner Laszlo Kovacs has called for an end to Austrian banking secrecy.

Kovacs said that putting an end to it would be especially important for combating tax-evasion and other criminal activities.

The commissioner also called on Austria to adhere to the standards of the Paris-based Organisation for Economic Cooperation and Development (OECD). They provide for the sharing of information about the accounts of people suspected of tax-evasion, among other things.

Kovacs said: "The question of bank secrecy is also a question of morality. Bank secrecy is a relic of an age with a different framework. I hope that Austria and Luxembourg will end bank secrecy, but that naturally depends on the behaviour of Liechtenstein and Switzerland. Their agreement to the sharing of information would naturally be the best solution."

At the same time, he noted, national governments should continue to be the agents of decisions about their citizens' tax liabilities.

Kovacs lamented that the 2005 EU law on the sharing of information and taxation of interest on savings accounts had "many loopholes" but noted that the opposition of Liechtenstein, Switzerland, Austria, Belgium and Luxembourg had made it impossible to close them.

The loopholes include the law's exclusion of financial centers in the Far East from its coverage and its omission of anything to do with taxation of other financial instruments.

14.03.2008 08:29:47