Singapore - The chief executive of the Swiss Bankers Association on Thursday warned European governments and the United States against overregulating tax enforcement, thus driving wealth out of their countries. "If tax authorities in European nations or in the US approach their citizens on the basis of mistrust, then taxpayers might be encouraged to go elsewhere," Urs Roth said in Singapore.
"And that has nothing to do with tax evasion," he added.
So far, he had not seen a significant outflow of assets from Europe to Asia, said Roth, but wealth might be driven out of Europe if tax enforcement went overboard.
If, for instance, broad-based automatic exchange of information was implemented, "then people might say I don't really like that," he added.
The future development would depend on whether the governments in Europe "find adequate solutions to tackle the tax compliance issue," Roth said.
Even after Switzerland agreed to the international standards on sharing information on taxes set by the Organization for Economic Cooperation and Development (OECD), he said, Swiss banks would not permit "the indiscriminate and unwarranted trawling through bank accounts" in the hunt for tax evaders.
"Both Swiss law and the OECD's model tax convention do not permit fishing expeditions," Roth said in a speech to the Singapore Foreign Correspondents Association.
"We cannot accept that state authorities should have an automatic right of forced entry into a bank account without any legal justification," he added.
The OECD had Switzerland listed as a country that had committed to globally agreed tax standards but had not substantially implemented them.
However, Roth said Switzerland recently got off the list by signing 12 double taxation agreements containing the OECD standard, with the latest agreement signed with Qatar last month.
