France spurns Swiss offer to tax stashed assets
Updated: 2011-08-19 11:32
PARIS - France has rebuffed for now a Swiss offer to tax French citizens' assets stashed in Swiss accounts modelled on a recent deal with Germany, a budget ministry source said on Thursday.
Switzerland, which has built up a $2 trillion offshore financial sector based on banking secrecy, made a similar offer to France, which is currently looking for billions of extra euros to help meet its deficit targets.
But Paris judged it could not accept the proposed deal in its current state, according to the ministry source.
"We are watching what our European partners do and we are looking at the compatibility of the proposal with our principles," the source said without elaborating.
Switzerland has a pact similar to its deal with Germany pending with Britain and other EU countries have been expected to follow suit.
French newspaper Le Monde, which first reported France had turned down the Swiss offer, reported that Paris could not accept because it considered such a deal would amount to giving up its pursuit of tax evaders.
"That contradicts our whole policy of recent years," the newspaper quoted an unnamed finance ministry official as saying.
Under the German deal, existing funds will be taxed at a rate of between 19 and 34 percent, based on how long the money has been stashed away and the rate of capital gains.
France's rejection of a Swiss deal comes as the government is preparing plans to tax the rich more heavily on those earning more than 1 million euros per year as part of a package of deficit-cutting measures worth billions of euros that is to be unveiled on Aug. 24.
Facing a tough battle for re-election in April, President Nicolas Sarkozy is eager to avoid being seen as easy on the rich, a charge levelled at him by his left-wing critics.
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