(CN) – The European Union and Switzerland have signed a landmark agreement aimed at thwarting tax evaders from stashing money in Swiss bank accounts, EU lawmakers said Wednesday.
Under the agreement, the EU and Switzerland will automatically exchange the financial information of all their residents beginning in 2018 in an effort to block would-be EU tax evaders from hiding income and assets in notoriously ironclad Swiss banks.
Switzerland will also strengthen its banking and finance laws to match the EU’s, and the agreement brings the famously independent nation into compliance with a 2014 global standard for the automatic exchange of financial account information.
Information exchanged by the Swiss and EU governments will include income from interest and dividends as well as account balances and tallies of the sales of financial assets, according to a statement by the European Council.
Tax authorities in the EU member states and Switzerland will be given the power to administer and enforce their tax laws in cross-border situations under the agreement as well.
Switzerland joined the Council of Europe in 1963, but its citizens have consistently shot down efforts to join the EU. Although completely landlocked by the EU, Switzerland does not belong to the European Economic Area.
In 2005, Swiss voters narrowly approved joining the Schengen treaty – the mechanism that created a single, borderless Europe and common visas for 400 million Europeans across 26 nations.
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