US and Switzerland to exchange data to track tax dodgers

Switzerland currently provides information on financial accounts to the US but does not receive any data from across the Atlantic. Keystone / Martin Ruetschi

The two countries plan to exchange financial data from 2027 to help both sides track down tax evaders.

A corresponding new agreement was signed in Bern on Thursday, Switzerland’s finance ministry announced, although Swiss law will have to be amended before the change can be implemented.

Switzerland currently provides information on financial accounts to the US but does not receive any data from the other side of the Atlantic. With the automatic exchange of information from 2027, Switzerland would continue to provide banking data as it has since summer 2014, but would also receive data from the US.

+ Read more: Switzerland exchanges financial information with 114 other countries

According to current plans, Switzerland is expected to receive information on account data in the US from January 1, 2027. Swiss financial institutions will not provide data to the US authorities as before, but to the Swiss Federal Tax Administration. The latter will then pass on the information to the US tax authorities.

The Foreign Account Tax Compliance Act (FATCA) is a US regulation that has applied to all countries worldwide since the beginning of 2014. It requires foreign financial institutions to disclose information about US accounts to the US tax authorities or to levy a tax.

In October 2014, the Swiss government decided to introduce the automatic exchange of information with the US and instructed its finance ministry to enter into corresponding negotiations.

The FATCA regulation has been applied in Switzerland since mid-2014. And since September 20, 2019, when the amendment to the double taxation agreement between Switzerland and the US came into force, FATCA group requests can be submitted.

Adapted from German by DeepL/kp 

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