Switzerland to start sharing tax information on multinationals by 2020

Switzerland to start sharing tax information on multinationals by 2020

Switzerland has agreed to start sharing information on the activities of multinationals within its territory with other countries by 2020, in a bid to join the fight against tax evasion.

This will see about 200 large companies in the low-tax haven to prepare country-by-country reports – showing where they are generating revenues and where they are paying taxes, Reuters report.

“Switzerland is thereby fully implementing one of the global minimum standards of the base erosion and profit shifting project, which aims to improve transparency with regard to the taxation of multinationals and to establish a uniform framework for the exchange of the reports,” the government said. Switzerland has attracted hundreds of multinationals with some of the lowest corporate tax rates in Europe. The measures affect companies with annual revenues of more than 750 million euros (669.28 million pounds).

Switzerland is houses various export-oriented companies that contribute extensively to its reputation as a global economic player.

SECRECY Nearly one third of European Union states backed a plan to tax digital multinationals on their turnover, France said last month, as the EU weighs a range of other measures to increase the tax bill of companies like Google and Amazon.

The moves are part of a growing campaign in the EU to claim tax revenues that online giants are accused of skirting by routing most of their profits to low tax rate states, like Ireland and Luxembourg.

Switzerland has made moves to become more open about tax affairs, especially after its bank were hit with massive fines by the U.S. authorities investigating secret bank accounts set up to evade tax. But it retains a reputation for secrecy.

A Swiss man went on trial in Frankfurt on Wednesday, accused of spying on a German tax agency to find out how it had obtained information on bank accounts held secretly in Switzerland by Germans.

“There are still some issues in Switzerland regarding tax transparency, but there has been progress, and the move to country by country reporting is a major step forward,” said John Christensen, a director at Tax Justice Network, a global advocacy group. “But Switzerland is still a follower rather than a leader when it comes to tax affairs.”

Some multinationals are paying special corporate rates tax rates as low as 7.8 to 12 percent in Switzerland, far below the 12 to 24 percent rate applied to normal companies. Switzerland proposed reforms to its business tax last month, hoping to win approval for an overhaul after voters in February rejected an earlier attempt.