ZURICH (Dow Jones)--Switzerland and the U.S. are set to hammer out the details of an agreement in principle reached between Swiss bank UBS AG (UBS) and the Internal Revenue Service, meaning the end to a messy legal spat is drawing near.
After lawyers for UBS and the IRS said a deal had been reached, the Swiss justice department said the two governments would spend the next week ironing out the details to settle the matter definitively out of court.
The outline of a deal, lauded by Switzerland's regulator, caused a surge in UBS shares, even if an end to the litigation isn't yet final.
The Zurich-based bank was up CHF0.61, or 4.1%, at CHF15.63 at 1511 GMT in heavy trading. The Stoxx Europe 600 bank index was up 1%.
The U.S. is seeking UBS client names as part of a stepped-up IRS campaign against wealthy tax scofflaws who hide their money offshore.
Even before the details are made public, the settlement represents a badly needed boost for UBS, which has struggled for months with massive outflows of funds as the U.S. pursued alleged tax dodgers with Swiss accounts.
Because the two governments have ordered the two parties remain mum until the details are released, UBS is unlikely to comment if pushed by analysts for specifics Tuesday, when the bank reports second-quarter earnings. In a statement, UBS said it wouldn't comment as remaining issues are worked through, which is expected to happen by Aug. 7.Read full article: http://online.wsj.com/article/BT-CO-20090731-714029.html
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PANAMA CITY — The month-old government here is expected to announce as soon as next week the first steps toward breaking with decades of banking secrecy that have drawn both tax-allergic customers and global rebukes.
ReplyDeletePanamanian officials insist that their limited financial unveiling is motivated solely by a desire to retool the economy for the post-financial crisis era, but the initiative's more immediate impact may be felt in the halls of the U.S. Congress. That's because Panama's image as a leading offshore financial center conducive to hiding profits from the tax man has become the latest hurdle for a pending U.S. trade deal, which has languished since its 2007 signing during the Bush administration.
Congressional Democrats, skeptical of the accord's promised benefits after years of what they say are trade-related job losses, insist that Panama must resolve lingering doubts about its willingness to cooperate on international tax probes before Congress will consider the treaty. The nation is one of 12 "tax havens" listed by the Paris-based Organisation for Economic Cooperation and Development.
"We understand that we have to move ahead on this, and we're gonna do it," Panama Vice President Juan Carlos Varela told USA TODAY in an interview. "We are committed to fight tax evasion and corruption everywhere."