Spain joins worldwide crackdown on secret offshore bank accounts

The Spanish tax authorities are investigating the holders of about 3,000 secret bank accounts in Switzerland over possible unpaid taxes, it has been confirmed.

Spain is the latest country to crackdown on citizens and expats who officials belief have offshore accounts in order to avoid paying tax. It is part of a worldwide crackdown on tax havens.

‘Our fight against fraud is becoming more intense,’ said Finance Minister Elena Salgado. She refused to indicate how much money is involved but reports in Spanish papers suggested it could be around €6 billion.

It is thought that details of the accounts came from the French authorities who seized a stolen disc with details of 24,000 Swiss bank account holders from the Geneva branch of banking giant HSBC by a former employee.

The US is also trying to get more bank account details from the Swiss and Germany also has stolen data. The Swiss though are reluctant to give up details easily and various legal cases are pending.

Italy has also been clamping down on offshore bank accounts and recently announced a tax amnesty to encourage those owing taxes to come forward. The UK has also offered an amnesty. The Spanish government has also ruled out such a move.

Belgium and the Netherlands are also putting pressure on the Swiss to releases details of potential tax evaders. It is estimated that Switzerland is home to more than a quarter, or $1.8 trillion, of the world’s offshore money. As much as 80% of Europeans’ offshore money via Switzerland is undeclared. The Swiss government has vowed to find ways to prevent foreigners from hiding undeclared funds in the country’s banks but progress is slow.

The Swiss banking lobby has suggested expanding an anonymous withholding tax system on clients’ earnings to guard privacy while addressing foreign countries’ tax-collecting needs.

The government is still divided over the issue and many leading figures want to seek to secure a sufficiently long transition period so to allow tax cheats to come clean or leave the country.

This strategy is in line with the approach so far followed by Liechtenstein, an opaque principality that made a U-turn last year to avoid the collapse of its financial services industry.

A recent poll published found that 67% of Swiss favour helping foreign countries chase tax evaders in Switzerland and 55% would do away with the distinction between tax evasion and tax fraud still in force for Swiss residents.

Many Swiss banks got rid of American clients last year after US authorities discovered employees at UBS were helping them avoid the tax man but until now have not been as strict with others who represent a much larger part of their business.

Tagged as: expats, secret bank accounts, Spain, tax evaders