RTS article (in French): Un accord fiscal a été conclu entre la Suisse et les Etats-Unis
Translation of RTS article:
A Tax Agreement has been concluded between Switzerland and the United States.
An agreement has been concluded between Switzerland and the United States on the application of American tax law. The agreement would permit the taxation of the accounts of Americans abroad, but under certain conditions.
The United States and Switzerland have signed Monday an accord about the application of the American tax law known as FATCA. The President of the Confederation Eveline Widmer-Schlumpf announced so Tuesday before the Swiss Senate.
The agreement must still be approved by the Federal Parliament, said the Secretary of State for International Financial Questions on Tuesday. It will be also submitted to an optional referendum as a matter of international treaty.
The text of the agreement will not be published until it is signed, the Secretary of State for International Financial Questions stated while communicating the message of the President. President Widmer-Schlumpf hopes for an entry in force of the agreement in early 2014, and made the information public during the morning, the Senate was the first to know.
Tax Accounts Abroad
The American tax law would permit Washington to tax all the accounts held abroad by persons subject to taxation in the United States. The “Foreign Account Tax Compliance Act” (FATCA) obliges banks and insurance companies to sign an agreement with the American tax authority in which they engage themselves to reveal all the accounts held by Americans. If they fail to do so, such financial institutions must pay a 30% withholding or no longer accept American clients.
The Federal Council [Cabinet] preferred the option of a FATCA application with simplifications to be stated in an agreement.
In June, the United States and Switzerland already decided upon the gist of a common declaration. According to the declaration, social insurance, pension funds, and property insurance will not be subject to FATCA.
Swiss banks will be authorized to conclude an agreement with American tax authorities in order to respect the engagements in matter of data transfer about American accounts. But they will not be required to reveal by name those American clients who refuse to cooperate or to close their account.
Rapid administrative assistance will nevertheless be accorded for grouped requests concerning supplementary data about the accounts of non-cooperative American clients.
The number and the total amount of these accounts will be transmitted by the banks directly to the United States tax authorities. Switzerland diverges in this way from the model proposed by 5 large EU nations (Germany, France, Italie, Spain, United Kingdom) who rely on data transfer via a central governmental database.