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Does the Anglo-Swiss tax agreement breach EU law?

Does the Anglo-Swiss tax agreement breach EU law?

As if the Chancellor hasn’t got enough on his mind trying to keep the UK from dropping back into recession, lawyers from the European Commission are unhappy about the recent Anglo-Swiss tax agreement.

According to the lawyers, the deal breaches European Union laws that take a tougher stance on tax evasion. George Osborne has been told to renegotiate the recently signed deal or be sued by the EU.

The new agreement protects the secrecy of UK residents who have Swiss bank accounts in return for a withholding tax and a large percentage of their capital.  The German government has also brokered a similar deal for its citizens and has now entered into new talks with Switzerland.

However, the EU claims the deal goes against the European Union Savings Directive. The EU’s tax commissioner, Algirdas Semeta, explained that if the problem cannot be easily resolved, the EU will have to pursue the matter through the courts.

Meanwhile, the Institute of Directors has said the UK government is not doing enough to attract overseas investors. The country’s tax system needs to be more competitive and the coalition should introduce incentives to encourage foreign businesses to invest in the UK and help fuel job growth.

The IoD’s director-general, Simon Walker, said the UK should be seen as the country of choice for international investors, and somewhere with a tax system that favours enterprise and hard work.

The tax system we have at present puts us in the middle of the 34 OECD nations, not in the front, he added.

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Image: 19 // jump for joy by lisadragon

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