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Informant offers to sell names of tax dodgers

A secret informant has offered to sell the German taxman the names of 1,500 Germans who have funds hidden in Switzerland, a newspaper reported Saturday.

Published: 30 January 2010 18:29 CET

Informant offers to sell names of tax dodgers

Photo: DPA

The daily Frankfurter Allgemeine Zeitung said the unnamed whistleblower had supplied details of five accounts worth some €1 million ($1.4 million) in tax as proof and demanded €2.5 million for the full list.

The paper quoted a tax official as confirming that the five accounts had been checked and said the finance ministry was considering the proposed deal.

“It’s now too late for these five to own up,” the official told the daily.

The German Finance Ministry declined to comment on the report while a Swiss Finance Ministry spokesman, Roland Meier, said Bern was waiting to see what Berlin expected.

If confirmed, the affair deals a new blew to Switzerland’s jealously-guarded banking secrecy which is under siege from several quarters. On Wednesday Swiss Finance Minister Hans-Rudolf Merz said Switzerland and France had resolved a spat over data stolen from the Geneva branch of banking giant HSBC.

He said that among other things France had agreed to send copies of the stolen data, concerning some 3,000 French citizens, to Switzerland, and promised not to transmit it to other countries.

Last year the former German finance minister, Peer Steinbrück, called on the Organisation for Economic Cooperation and Development (OECD) to put Switzerland on its black list of tax havens.

Switzerland was placed on the “grey list” of uncooperative countries but agreed to follow OECD rules on tax matters and end a distinction it made between tax evasion and fraud. It has since signed a separate agreements with a dozen countries on exchange of tax information, though not all have been ratified.

In a government-brokered settlement for charges of tax fraud in the United States, Switzerland’s banking flagship UBS last year agreed to hand over details of about 4,450 clients and US taxpayers to US authorities.

But last week a Swiss court upheld an appeal by one taxpayer against the transfer, saying the deal could not take precedence over the existing Swiss-US dual taxation agreement.

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Output is expected to expand 0.3 percent this year, the economy ministry said, up from a prediction of 0.2 percent in February.

The slightly rosier picture comes after improvements in key indicators — from factory output to business activity — boosted hopes a recovery may be getting under way.

The German economy shrank slightly last year, hit by soaring inflation, a manufacturing slowdown and weakness in trading partners, and has acted as a major drag on the 20-nation eurozone.

But releasing its latest projections, the economy ministry said in a statement there were growing indications of a “turning point”.

“Signs of an economic upturn have increased significantly, especially in recent weeks,” Economy Minister Robert Habeck said at a press conference.

The ministry also cut its forecast for inflation this year to 2.4 percent, from a previous prediction of 2.8 percent, and sees the figure falling below two percent next year.

“The fall in inflation will lead to consumer demand — people have more money in their wallets again, and will spend this money,” said Habeck.

“So purchasing power is increasing, real wages are rising and this will contribute to a domestic economic recovery.”

Energy prices — which surged after Russia’s 2022 invasion of Ukraine — had also fallen and supply chain woes had eased, he added.

Several months ago there had been expectations of a strong rebound in 2024, with forecasts of growth above one percent, but these were dialled back at the start of the year as the economy continued to languish.

‘Germany has fallen behind’

But improving signs have fuelled hopes the lumbering economy — while not about to break into a sprint — may at least be getting back on its feet.

On Wednesday a closely-watched survey from the Ifo institute showed business sentiment rising for a third consecutive month in April, and more strongly than expected.

A key purchasing managers’ index survey this week showed that business activity in Germany had picked up.

And last week the central bank, the Bundesbank, forecast the economy would expand slightly in the first quarter, dodging a recession, after earlier predicting a contraction.

German Economics Minister Robert Habeck

Economics Minister Robert Habeck (Greens) presents the latest economic forecasts at a press conference in Berlin on Wednesday, April 24th. Photo: picture alliance/dpa | Michael Kappeler

Despite the economy’s improving prospects, growth of 0.3 percent is still slower than other developed economies and below past rates, and officials fret it is unlikely to pick up fast in the years ahead.

Habeck has repeatedly stressed solutions are needed for deep-rooted problems facing Germany, from an ageing population to labour shortages and a transition towards greener industries that is moving too slowly.

“Germany has fallen behind other countries in terms of competitiveness,” he said. “We still have a lot to do — we have to roll up our sleeves.”

Already facing turbulence from pandemic-related supply chain woes, the German economy’s problems deepened dramatically when Russia invaded Ukraine and slashed supplies of gas, hitting the country’s crucial manufacturers hard.

While the energy shock has faded, continued weakness in trading partners such as China, widespread strikes in recent months and higher eurozone interest rates have all prolonged the pain.

The European Central Bank has signalled it could start cutting borrowing costs in June, which would boost the eurozone.

But Habeck stressed that care was still needed as, despite the expectations of imminent easing, “tight monetary policy has not yet been lifted.”

In addition, disagreements in Chancellor Olaf Scholz’s three-party ruling coalition are hindering efforts to reignite growth, critics say.

This week the pro-business FDP party, a coalition partner, faced an angry backlash from Scholz’s SPD when it presented a 12-point plan for an “economic turnaround”, including deep cuts to state benefits.

Christian Lindner, the fiscally hawkish FDP finance minister, welcomed signs of “stabilisation” in the economic forecasts but stressed that projected medium-term growth was “too low to sustainably finance our state”.

“There are no arguments for postponing the economic turnaround,” he added.