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SWITZERLAND

Swiss bank ‘bans advisers from Germany’

The tax row between Germany and Switzerland escalated on Wednesday with mounting speculation that Swiss bank Crédit Suisse had banned its customer advisers from travelling to Germany.

Published: 4 April 2012 12:13 CEST
Swiss bank ‘bans advisers from Germany’
Photo: DPA

Swiss financial paper Börsen-Zeitung first reported the travel ban without naming sources, but Crédit Suisse denied the report, saying that it was based on an email sent by mistake.

The bank first ordered a travel ban on its employees in spring 2010, when revelations about a secret CD containing bank details of German tax evaders keeping money in Swiss banks first surfaced.

Some German politicians have said it is plausible that the bank has re-introduced a travel ban.

“This is good news,” Green Party financial spokesman Gerhard Schick told business daily newspaper Handelsblatt. “Crédit Suisse can do its honest business through its German branches. But if the Swiss headquarters are sending advisers abroad, it’s a sign it is deliberately not using this structure.”

The row re-ignited last weekend, when Swiss authorities issued an arrest warrant on three German tax inspectors who bought the stolen CDs from unnamed sources.

German tax authorities from the state of North Rhine-Westphalia defended their officials, saying they had done their duty.

In a separate development, Germany’s Bild daily, the most-read newspaper in Europe, said Wednesday it had filed a lawsuit against a Swiss minister amid a simmering tax evasion row between the two neighbours.

Enraged by Switzerland’s threat, the paper filed a suit against Justice Minister

Simonetta Sommaruga for attempted false imprisonment, coercion and complicity

to tax avoidance.

The Swiss authorities have taken aim at German tax officials “who were just doing their job,” Bild said, also criticising Switzerland for “standing by for decades as tax evaders stash away millions in their country.”

A proposal to assuage the row by forming a new tax agreement with Switzerland was dismissed by opposition leader Sigmar Gabriel of the centre-left Social Democrats.

“That sends a signal that the state can be bought,” he told the WAZ media group. “That’s a slap in the face to the taxpayer and the rule of law.”

The proposal would allow secret income that Germans keep in Switzerland to be taxed retrospectively – but without punishing the tax evaders.

On Tuesday, German Finance Minister Wolfgang Schäuble called this a “sensible, respectful” solution, but the opposition says this simply lets evaders off.

The Local/DAPD/bk

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TAXES

Beskæftigelsesfradraget: What is Denmark’s employment allowance?

Denmark's government may soon announce changes to its tax reform plans, which will give all wage earners a bigger employment allowance. What is this and how will it affect foreigners' earnings?

Published: 30 October 2023 15:21 CET
Beskæftigelsesfradraget: What is Denmark's employment allowance?

What is the employment allowance? 

The Beskæftigelsesfradraget (from beskæftigelse, meaning employment, and fradrag, meaning rebate) was brought in by the centre-right Liberal Party back in 2004, the idea being that it would incentivise people to get off welfare and into a job.

Everyone whose employer pays Denmark’s 8 percent AM-bidrag, or arbejdsmarkedsbidrag, automatically receives beskæftigelsesfradraget. Unlike with some of Denmark’s tax rebates, there is no need to apply. The Danish Tax Agency simply exempts the first portion of your earnings from income taxes. 

In 2022, beskæftigelsesfradraget was set at 10.65 percent of income with a maximum rebate of 44,800 kroner. 

How did the government agree to change the employment allowance in its coalition deal? 

In Responsibility for Denmark, the coalition agreement between the Social Democrats, the Liberals and the Moderate Party, the new government said it would set aside 5 billion kroner for tax reforms.

Of this, 4 billion kroner was earmarked for increasing the employment allowance, with a further 0.3 billion going towards increasing an additional employment allowance for single parents.

According to the public broadcaster DR, the expectation was that this would increase the standard employment  allowance to 12.75 percent up to a maximum rebate of 53,600 kroner. 

How might this be further increased, according to Børsen? 

According to a report in the Børsen newspaper, the government now plans to set aside a further 1.75 billion kroner for tax reforms, of which nearly half — about 800 million kroner — will go towards a further increase to the employment allowance. 

The Danish Chamber of Commerce earlier this month released an analysis in which it argued that by raising removing all limits on the rebate for single parents and raising the maximum rebate for everone else by 20,300 kroner, the government could increase the labour supply by 4,850 people, more than double the 1,500 envisaged in the government agreement. 

According to the Børsen, the government estimates that its new extended allowance will increase the labour supply by 5,150 people.  

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