The New Amendments to Swiss Banking Secrecy Laws

On 17 June 2011 the Swiss parliament gave approval to Switzerland’s amendments to tax treaties with other countries, including India. This makes easier access for India, to collect information about the illegal funds held by the Indian nationals in Swiss private banks. The Swiss parliament endorsed amendments to double-taxation agreements (DTAAs) in line with internationally applicable standards.

The beneficiaries from the new amendments include India, Germany, Canada, Japan, the Netherlands, Greece, Turkey, Uruguay, Kazakhstan, and Poland. These countries are secured with easy legal assistance and information. This also allows the countries to identify an account holder from their own territories by providing an IBAN number or social security number.

Indian Finance Ministry and Swiss Federal Council signed a protocol to amend the double taxation agreement in the area of taxes on income on 30 August 2010. Paris-based Organization for Economic Cooperation and Development and the G-20 leaders’ intense pressure finally made Switzerland begin a process of simplifying their tax laws. Switzerland was initially included in the OECD's black list of countries for following banking secrecy and client-confidentiality rules. It agreed to adopt its tax code, agreeing to share information in cases involving tax which is not a crime under Swiss law.

The new amendments to Swiss banking secrecy laws are however be challenged by a popular referendum within 100 days from its announcement.