Swiss parties fail in bid to axe foreign tax pacts

According to Swiss law, anyone opposed to current legislation can try to reverse it through the ballot box, as long as they gather 50,000 signatures in an official petition.

But the proposal to reject a tax pact signed with Berlin last year came up 1,500 signatures short, the Swiss Federal Chancellery said in a statement.

The petitions opposing the London and Vienna accords were 2,500 and 3,000 signatures off target respectively, the Chancellery said.

The tax deals are aimed at ending disputes over billions of euros hidden from tax authorities in Swiss bank accounts and are due to take effect on January 1st 2013.

According to the deals, foreigners with non-declared funds in Switzerland will maintain their anonymity, but their assets will be taxed by Bern, which in turn will transfer the revenues to their country of origin.

The youth wing of the right-wing Swiss People's Party, one of the three mainstream political movements behind the petitions aimed at nixing the deals, accused the government of making too many concessions to foreign tax authorities.

Switzerland should have given a clear signal to other countries not to use stolen bank data, the political party said, hinting at German Rhine-Westphalia region's alleged use of stolen files to track down German clients of Swiss banks.

Barring a new petition in Switzerland, the German fiscal pact could still fall through, since it still must be ratified by both houses of the German parliament.

In the upper house, the opposition Social Democrats and Greens hold a majority.

Both parties claim the agreement — which requires Swiss banks to pay around €1.9 billion to German tax authorities to regularize any hidden assets of German taxpayers — is too soft on tax dodgers.

Between €130 billion and €180 billion in German assets are hidden in Switzerland, German media claim. These assets would therefore net up to €54 billion (65 billion francs, $70 billion) in taxes.