The declaration, which was signed in Canberra on Tuesday, is Switzerland’s first agreement for the mutual exchange of tax information under an existing international framework developed by the Organisation for Economic Co-operation and Development (OECD).
The two countries plan to start collecting data in 2017, with a view to begin sharing the information the following year.
“Improving market access”
“The joint declaration specifies that each jurisdiction is satisfied with the confidentiality rules provided for in the other jurisdiction with regard to tax,” said the Swiss finance ministry in a statement.
“Australia has also declared its willingness to hold talks on improving market access for Swiss financial service providers.”
The Swiss Federal Department of Finance (FDF) will now prepare a consultation paper on the introduction of the information exchange with Australia.
The agreement is based on the legal structure of the Multilateral Competent Authority Agreement (MCAA), which 51 countries signed in October last year to allow tax authorities to swap financial account information about non-residents to an account holder’s country of residence. In November Switzerland became the 52nd country to sign up to the tax information sharing agreement.
Around 100 countries have now said they intent to adopt the OECD standard, which is designed to clampdown on tax evasion through cooperation on an international scale.
Information will start being collected under the MCAA from next year with a plan to exchange it for the first time in 2017.
Switzerland has recently come under pressure to do more to prevent tax evasion after HSBC allegedly helped thousands of people hide cash in undeclared Swiss bank accounts. Leaked documents identified more than 300 Australians who held undeclared Swiss bank accounts with HSBC.
Last week a deal was signed between Italy and Switzerland in an effort to tackle tax evasion. This agreement gives Italian citizens an opportunity to voluntarily declare Swiss bank accounts in exchange for more lenient criminal charges and fines.
