Swiss Bank Becomes the First to Get in on US Tax DealTax Professionals' Resource
December 16, 2013 — 1,656 views
The Valiant Bank has become the first Swiss bank to announce its intention of entering into a deal with the US government to end a three year tax evasion dispute. The Valiant Bank, along with three other Swiss Banks entered into the deal to ensure more transparency with the US government. The deal has currently been accepted only by three banks, but it will soon be offered to other Swiss banks as well.
Swiss banks have long had a reputation for their secrecy and anonymous accounts. It has long been alleged that many Americans had stashed away their wealth in Swiss bank accounts to avoid paying taxes. This had led to a severe backlash against Swiss banks with many politicians calling for stronger regulations.
The large Swiss banks like Credit Suisse and UBS have also been criticized for their role in the 2008 financial crash and for their unethical business dealings. The smaller banks have also had a role to play in money laundering and large scale tax evasion.
The Terms of the Deal
Under the deal, the banks will have to reveal the names of the account holders who operate accounts at the banks. The banks will also have to obtain registration during which process they will have to divulge details about their management and the general finances of the bank. The deal is currently being offered to all Swiss banks that have operations in the US.
The deal could make Swiss banks more transparent in their dealings. It could also make dealing with the banks more acceptable in the American economy. If all Swiss banks accept the deal, it will not be long before the Swiss banks might completely lose their past stigma of ‘black money’.
The deal will make it more difficult for Americans to evade taxes. The deal requires the banks to reveal the identities of the account holders which can be used to hold them liable to taxation.
The US government has started offering deals to Swiss banks in an attempt to restrict tax evasion and money laundering by American citizens. As of now, three banks have accepted the deal, but the number is expected to rise in the near future. The acceptance of the deal will also lead to more transparent and safe dealings when it comes to Swiss banks.