Treasury closes in on deal with Swiss on tax

BRITAIN yesterday was in the closing stages of a deal with Switzerland to tax undeclared assets in a deal that will bag £3bn for the government by 2015.

Britons with funds in Swiss bank accounts will be forced to pay tax on new deposits, as well as a one-off retrospective levy.

A withholding tax rate of 50 per cent would apply to income from Swiss bank accounts held by British taxpayers, swelling the Treasury’s coffers in time for the May 2015 general election.

The deal could force individuals who hide money to move cash away from Switzerland to alternative locations, including Singapore, Hong Kong and the US.

Yet tax havens worldwide are coming under pressure from governments strapped for cash in the wake of the financial crash and the global sovereign debt crisis.

Swiss authorities are said to have been in talks with the Treasury since last October, although no deal has yet been signed.

“Constructive discussions are currently ongoing, but substantive issues remain and no agreement has been reached,” a Treasury spokesman said.