EU Commission President José Manuel Barroso has called on the Swiss government to do more in the ongoing spat over low corporate taxes in Switzerland. He also said that while no pressure was being put on Switzerland to join the European Union, an isolated country had no political influence and no future in an age of globalisation.
Having just paid $800 million dollars to the EU when they didn’t really have to, I would have thought that the EU Minister would have a little more respect for Switzerland.
Barroso continued “…a country all on its own would be “lost” when it came to economic competition and its political influence would be reduced to zero. Regarding Switzerland, Barroso said the country was “more involved” in the European Union than some member states – “and also more dependent on Europe”, he added with a smile.
And there we have the second veiled threat in the last six months from Europe. The first one was a minister saying that “we are not looking at sanctions at this stage” with regard to the tax issue.
The European union is based on the pretence that the individual nations are better off as a ‘collective’ and the power and free movement within that collective brings all the members a better level of economic and social success.
I have lived in several EU countries and now live in Switzerland and have experienced, first hand, the EU’s affect on the citizens of member states. Most are annoyed with education, health services, security, immigration, but worst most feel powerless to do anything about it. Can the UK actually call the last elections legitimate when only 30 odd per cent of the population voted? The biggest reason given by non voters was “it won’t make any difference”. That’s because in countries like the UK, I am afraid, it doesn’t.
No referendums on European policy. There was not going to be a referendum on the constitution and when it comes around again, and it will, there will not be one then. Politics in the UK and Europe are about rail roading the masses with gimmicks and spin, while taxing the country to death. On an average £100 spent in the UK only £23 worth of goods and services are bought, the rest is tax…
So why would a country like Switzerland (where my kids can walk to school without fear, where I do not worry where I park my car and where, even as a foreigner, I get to vote on everything that affects my life from state insurance companies to government spending) want to take on the policies of Europe and become just another country and peoples to be pushed around at the will of faceless bureaucrats?
“Democracy” is an oft touted word in European circles and is something that is waved around like a European Standard, but if EU citizens would really like to know what democracy is and how it works very, very well then you should visit Switzerland.
If the price of safety, security and piece of mind is the fact that a few companies and fat cats can pay less tax being here than being in any other EU country, I can live with that.
Oh and Mr Barroso “a country on its own will be lost, when it comes to economic competition” isn’t that what the argument is about, ‘Tax’ competition? Just because Switzerland are winning doesn’t mean the EU can change the rules…
As my son would say….. Dad “Don’t hate the player, hate the game”…
By Swiss Info
Ultra-rich foreigners are flocking to Switzerland in increasing numbers to take advantage of controversial lump sum tax arrangements offered by many cantons.
The number of tax exiles reached 4,175 last year up from 2,394 in 2003, according to a survey by consultancy group KPMG. The policy has attracted critics both within and outside the country.
Earlier this year a spokesman for French Socialist presidential candidate Ségolène Royal accused Switzerland of “banditry” after Johnny Hallyday, a French rock star, announced he would switch residency for tax purposes.
Hallyday will join a growing list of multi-millionaire celebrities and business leaders moving to Switzerland, including musicians Tina Turner and Phil Collins, former Formula One driver Michael Schumacher and Ikea founder Ingvar Kamprad.
Swiss tabloid newspaper Blick questioned why Hallyday would pay SFr300,000 ($246,000) in taxes by special arrangement while Swiss tennis ace Roger Federer has to pay SFr3 million – despite both earning around SFr10 million.
Such rich foreigners avoid paying tax on their total wealth and usually contribute a lump sum based on five times the rental value of their Swiss property instead.
However, KPMG partner Patrick Burgy disputed the popular belief that wealthy foreigners do not contribute to Swiss society.
KPMG estimates that Swiss tax coffers benefited to the tune of up to SFr600 million in 2004, a figure that probably nudged SFr1 billion last year also accounting for social security payments and tax revenues on interest earned in Swiss banks.
Challenging perceptions
“The general perception is that lump sum tax payers have too good a deal and are not paying their fair share,” Burgy told swissinfo.
“But our calculations show that these people are paying the same amount on average as the average Swiss tax payer who earns more than SFr200,000.
“What people also forget is that any income they derive from foreign sources, such as a concert staged in Japan, is also subject to withholding tax in that country. So the lump sum payment in Switzerland is often only half the story.”
KPMG also revealed that wealthy foreigners in canton Valais in western Switzerland contribute 5.2 per cent of the total tax collection despite making up only 0.6 per cent of the local population. In six of Switzerland’s 26 cantons, rich foreigners contributed at least two per cent to the local tax purse in 2004.
But this argument does not wash with the centre-left Social Democrat Party, which is campaigning to bring a halt to the practice.
“We are against lump sum taxation because it is not just and is in breach of the constitution. According to the constitution all citizens should be treated equally and taxed according to their ability to pay,” Social Democrat spokeswoman Claudine Godat told swissinfo.
“We are not sure if the figures in the [KPMG] report are accurate [regarding the numbers of lump sum payers]. But if they are correct, then it is indeed worrying.”
