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Monday August 2nd, 2021 12:35PM

Officials in Switzerland push back at Biden 'tax haven' barb

By The Associated Press

GENEVA (AP) — Swiss authorities took issue Friday with U.S. President Joe Biden's comment that many companies use Switzerland and two British territories as tax havens, with the Swiss Federal Department of Finance calling such claims “inappropriate and completely out of date.”

Arguing that rich Americans and corporations need to pay their fair share of taxes, Biden said in a speech to Congress on Wednesday that “a lot of companies also evade taxes through tax havens in Switzerland and Bermuda and the Cayman Islands.”

Switzerland long had a reputation as a haven for tax dodgers to squirrel away their money to avoid fiscal authorities abroad. But Swiss authorities have been at pains to try to change the country’s image.

“Switzerland considers this highlighting of Switzerland as a tax haven by the USA as inappropriate and completely out of date,” Federal Department of Finances spokesperson Isabelle Roesch said in an email. “Switzerland meets all international standards in tax matters.”

Roesch said “international bodies” have since 2019 repeatedly affirmed that Switzerland fulfills all international tax standards, including for country-by-country reporting and information exchange. She said a Swiss tax reform that year abolished “all tax models criticized" by the Organization for Economic Co-operation and Development, a group made up of rich countries.

“The OECD has confirmed this in writing to Switzerland in 2020,” Roesch said. “We reported this to the U.S. Treasury last week, as this is not the first time the new administration has made these statements.”

She said Swiss Finance Minister Ueli Maurer would make U.S. Treasury Secretary Janet Yellen aware of the information “at the earliest opportunity.”

While Biden called out offshore tax havens, anti-corruption activists say the United States should also scrutinize rules that help tax evaders closer to home.

The London-based Tax Justice Network last year named the U.S. as the second-biggest enabler of financial secrecy worldwide, after the Cayman Islands and ahead of Switzerland.

Delaware, the state that Biden represented in the Senate for 36 years, has long had a reputation for allowing companies and wealthy individuals to hide the true beneficiaries of anonymous shell companies registered there.

Tax Justice Network expert Nick Shaxson said for many years, there was a “plague on both houses" in both the U.S. and Switzerland, but each country has also cleaned up its act in recent years. He cited in particular a U.S. reform in the waning days of the Trump administration.

“While there's been a cleanup, Switzerland is still emphatically a tax haven,” said Shaxton, author of “Treasure Islands," a book about tax havens. While it has become harder for U.S. or other developed-nation citizens to hide money in Switzerland, it's still pretty easy for people from “weaker” countries to do so, he said.

"Whenever the U.S. pointed a finger at Switzerland (about tax havens), there's always been a level of hypocrisy," Shaxton said, "It looks even more hypocritical coming from Biden,” alluding to the president's ties to Delaware.

  • Associated Categories: Associated Press (AP), AP Online Headlines - Washington, AP Online Congress News, AP World News, AP Business, AP Business - Corporate News
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