Government gets initial 340 million pounds from Swiss tax deal

LONDON (Reuters) - Britain has received an initial 340 million pounds from the Swiss government as part of a deal to tackle tax evasion that the government expects will net it some 5 billion pounds over the next six years.

Switzerland agreed with Britain last year to impose a one-off levy on money in Britons' secret Swiss bank accounts and to tax future interest payments, with effect from the start of 2013. Germany rejected a similar deal.

Switzerland has been under pressure from the United States, Germany and Britain to clean up its private banking system, which has allowed many wealthy foreign nationals to avoid tax due to its tradition of bank secrecy.

"Last night HMRC (UK tax authorities) received 340 million pounds from the Swiss government, in the first instalment of a deal we have struck," Chancellor George Osborne told parliament. "(This is) the first time in our history that money due in taxes has flowed to this country from Switzerland, rather than the other way round," he added.

Osborne was facing criticism in parliament about his fiscal plans, which are already two years behind on their original goal of eliminating the country's structural budget deficit by 2015. Borrowing in the 2012/13 tax year is forecast to total 108.5 billion pounds, equivalent to 6.9 percent of economic output.

The 340 million pounds is a shade over the 330 million pounds pencilled in to come from this source during the 2012/13 tax year. Some 3.12 billion pounds is expected in the next tax year, and total tax receipts out to 2017/18 are seen at just over 5 billion pounds.

Britain has made tackling tax avoidance by companies as well as individuals a priority for its presidency this year of the G8 group of major advanced economies.

(Reporting by David Milliken; editing by Patrick Graham)

Source: http://news.yahoo.com/government-gets-initial-340-million-pounds-swiss-tax-142021690--business.html

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