Decision on EU Savings Taxation Agreements with third countries postponed

The European Commission is ready to step up its fight against an estimated 1 trillion euro in tax evasion

ECOFIN discussed a draft decision aimed at giving a mandate to European Commission to negotiate amendments to agreements signed in 2004 with Switzerland, Liechtenstein, Monaco, Andorra and San Marino on the taxation of savings income.

The negotiations would aim to update the agreements so as to ensure that the five countries apply measures that are equivalent to an amended EU directive on the taxation of savings income.

In 2010, EU nations collected about 330 million euro in savings tax withholdings from Switzerland, according to the EC document.

Before Austria and Luxembourg have opposed the commission’s negotiating mandate, citing concerns that such a move would threaten their current policies.

In the light of reservations expressed by two delegations, the presidency suggested that the issue be included in a report to the European Council on tax issues that is scheduled for June.

The report will cover ways to step up the fight against tax fraud and tax evasion, including in relation to third countries.