The French association Groupement Transfrontalier Européen offers assistance and services to its members living on the French side of the border who are working in Switzerland. Although their website and documentation is in French, some advisers speak English and will answer your questions regarding all aspects of your day-to-day life as cross-border workers, from housing to transportation to various legal, social and tax issues. Other services include job search support, discount prices at selected stores and companies, and a yearly fair. They have several offices along the border, including Annemasse and Saint Genis Pouilly.
GENEVA, SWITZERLAND – A Montreal man who was among 1,700 whose names were provided to the Canadian revenue service after bank data was stolen by a Geneva HSBC computer employee is now suing his country’s tax department. The suit brought against the Canada Revenue Agency in March comes as a Zurich court has gone after German tax authorities for accepting stolen data.
The CBC broadcasting company reports that the “application seeks an injunction to prevent the government from continuing to use “stolen data” to find out more about Canadians with Swiss bank accounts.
It also suggests that because the Canada Revenue Agency may be conducting a clandestine criminal investigation, Canadians with offshore bank accounts should not have to give the CRA information that might lead to criminal charges.”
The case dates back to data stolen by Frenchman Herve Falciani, who called himself a whistleblower and who tried to sell the information, which was at least three years old, to a number of governments. A French high court ruled early in 2012 that the data could not be used.
Major Swiss highway programme changes announced
Annual highway tax/sticker to jump from CHF40 to 100 by 2015
GENEVA / LAUSANNE, SWITZERLAND – The roadworks weren’t welcome at the time, but the switch in Morges from two to three lanes during rush hour, using emergency lanes, has been such a success at reducing traffic jams that the Federal Highway Office plans to set up the same system in Geneva and Lausanne.
The measure is part of a series of highway improvements announced by Bern Wednesday 18 January, with the focus on shifting 378km of cantonal roads to the national highway system by 2014, to better needs today that are the result of a series of urban developments over the past five decades.
Morges again has special treatment, with the office adding a Morges bypass to the list of projects to be developed sooner rather than later, to ease the growing congestion in the Crissier area. The cost: CHF220 million. Details of a likely bypass, published in 2009, call for a larger loop from Morges Ouest (west) to Ecublens.
The A1 around Morges was given three lanes in 2009, for rush hours
The package includes traffic flow improvements for Coppet-Le Vengeron, at a cost of CHF175m.
The number of kilometres driven on Swiss autoroutes has doubled since 1990. Recent studies show a 34 percent increase in 2010 in the number of hours of traffic jams, to 15,910, compared to 2009 In the next 18 years, some 400km of autoroute will regularly suffered congestion.
The Morges area switch to three lanes during rush hours has improved traffic flow, the highway department says, lowered the accident rate by 15 percent in general and 80 percent locally, and it has also brought about a 20 percent reduction in pollution next to roads: CO, CO2 and NOx emissions.
Bern and Winterthur will see their emergency lanes changed in the near future, with Geneva and Lausanne, but also several other areas including stretches along Lake Zurich, scheduled for later.
Automatic signals to reduce speed for better traffic flow to go from 85km to 400km
GENEVA, SWITZERLAND – Australia’s six-stage immunization programme covers 9 out of 10 children, the Sydney Morning Heraldreports, but the highest prevalence of whooping cough in 20 years is in part driving a campaign to increase the number of immunized children. The government will expand its programme to encourage families to get their children covered.
An extended plan starting in July 2012 will get rid of the $258 payment all families currently receive if their children are immunized. “Instead the government will require parents have their children fully immunised or forgo three payments of $726 available under the family tax benefit A end of year supplement. The family tax benefit A goes to about 90 per cent of families with young children and the payment provisions will apply for the financial years when the child is one, two and five years of age.”
The number of chidren with whooping cough, or pertussis, has jumped eight-fold in four years to over 34,000 and the government vaccination programme notes that a “single booster dose of adult formulation pertussis vaccine (dTpa) is recommended for all adults planning a pregnancy, for both parents as soon as possible after delivery of an infant, and for grandparents and other carers of young children.”
BERN, SWITZERLAND – Bicycle owners in Switzerland will say farewell at the end of the year to the CHF5 tax and stickers on their bikes, the Federal Council confirmed 13 October.
The tax, in reality a form of third party insurance, will no longer be necessary as of 1 January 2012, but the insurance coverage from 2011 licenses is valid until 31 May 2012.
The system is being phased out to allow private RC (responsabilité civile) insurance to provide third party coverage. Most Swiss have RC coverage but Bern says a campaign will start soon to make those without it aware of the risks they run.
Details, GenevaLunch 23 May 2011
Rubbish bin shed in canton Valais: no tax here until 2012
BERN, SWITZERLAND – French-speaking communes in Switzerland must join most German-speaking ones by 2012 in applying the polluter-pays rule for rubbish collection, the Swiss Federal Tribunal in Lausanne said Thursday 4 August. A citizen in Romanel-sur-Morges, backed by the Green Party, challenged his commune’s general tax on rubbish and won in a Vaud court in 2009.
The federal court today backed the cantonal court, saying that a lump sum tax is inconsistent with Switzerland’s 20-year-old law that the polluter must pay. The law is designed to act as an incentive to reduce rubbish.
Most German-speaking areas in the country place a tax on garbage bags or levy a per weight tax.
Links to other sites: Greens blog on the tax, 2009 (Fr); 24 Heures, December 2010
Home sweet home, but don't ask a bank outside the US to finance it, if you're an American citizen
Geneva, Switzerland (GenevaLunch) – The strange case of John Doe, US citizen who lives in Switzerland and can’t open a local bank account or keep one, is now catching the attention of Swiss media.
Le Matin Dimanche (available online only to subscribers) ran a full-page article Sunday entitled “American clients ejected by Swiss banks”, which focuses on the impact on Swiss residents with US connections, of the new US Fatca law, signed into law in March 2010. It goes into effect in 2013.
The newspaper’s argument is that Swiss banks are no longer accepting Americans who live in Switzerland as clients, a fact born out by some of the nearly 80 personal stories from around the world registered with ACA (American Citizens Abroad), as well as numerous anecdotes that GenevaLunch has collected.
David Treitel, a tax specialist quoted by Le Matin, says that 20 percent of his US clients have had to change banks.
The article has some flaws in its details: it says there are 10,000 US citizens in the Lake Geneva region and 30,000 in Switzerland, while the number is most likely considerably higher because dual citizens in particular but also many long-term residents in Switzerland do not register with the US Embassy, and the Swiss government does not issue figures.
Renouncing citizenship is a long process
The newspaper also states that there is a six-month wait for appointments to renounce US citizenship, for dual nationals who are taking that route to dealing with the growing problem of being American outside the US. But when GenevaLunch recently checked, the US Embassy was taking appointments for May 2012, 15 months away, and the waiting list in some other countries is equally long.
Other disincentives appear to be at work, such as insisting that citizens come in for a first interview, then return weeks later for a second meeting, costly for anyone at a distance from an embassy.
Nevertheless, Le Matin has drawn Swiss attention to a growing problem for a key group of foreigners in the country, where 22 percent of the population is foreign. The impact is not limited to US citizens: it covers anyone who has held a US Green Card as well, and nor is it limited to these groups living in Switzerland since it touches anyone outside the US.
Fatca’s deep, wide net will catch far more than fraudsters
Fatca is designed primarily to catch people who are illegally avoiding paying US taxes, but the net has been thrown wide and deep, prompting ACA to formally contest the legislation as details were drafted in 2010.
“Fatca aims to go after tax evaders by requiring massive reporting to the IRS on two fronts–first from all foreign financial institutions taken in the largest sense of the term and secondly from all US persons who have a foreign bank account, foreign investments or foreign trust,” the non-partisan group argues on its web site.
“This means that all US citizens residing abroad, who necessarily have a foreign bank account, will have to report on their 1040 all assets held in foreign institutions.” Congress has “created a reporting monster with Fatca,” argues the ACA. “It will cost billions of dollars for foreign financial institutions to comply and it will significantly increase the reporting compliance costs of individual US citizens residing abroad.”
The numerous provisions include:
- impose a 30 percent tax withholding on payments either to foreign banks and trusts that fail to identify US accounts and their owners and assets to the IRS, or to foreign corporations that do not supply the name, address, and tax identification number of any US individual with at least 10 percent ownership in the firm (effective for payments made after December 31, 2012)
- impose penalties as high as $50,000 on U.S. taxpayers who own at least $50,000 in offshore accounts or assets but fail to report the accounts on their annual income tax return (effective for tax years beginning after the date of enactment)
- levy a 40 percent penalty on the amount of any understatement attributed to undisclosed foreign assets (effective for tax years after the date of enactment)
- allow the Treasury Department to presume that a foreign trust has U.S. beneficiaries if a U.S. person directly or indirectly transfers property to the trust (effective for transfers of property after the date of enactment);
- establish a $10,000 minimum failure-to-file penalty for some foreign-trust-related information returns (effective for notices and returns due after December 31, 2009).
The ramifications of the new Fatca legislation are only beginning to be felt, with Swiss banks and other financial institutions, including PostFinance, refusing at least some services, if not all, to clients.
One man who is getting close to retirement tried to move funds to a PostFinance account but was told that as an American investment funds are closed to him. PostFinance, as an arm of the Swiss government, which must legally respect Swiss banking secrecy laws, may have a tough time complying with Fatca legislation. Smaller banks, including regional banks, have said the cost may be too high.
ACA is seeking testimony from US citizens who have had trouble opening or keeping their non-US bank accounts.
Passport application data will go to the IRS
American citizens who until now have hoped the passport application office and the IRS would continue to ignore each other while they try to understand the implications of the new legislation, or to become compliant with filing requirements they have learned about only in the past year or two, will be surprised to see the latest version of the passport renewal or application form.
It makes it clear that a social security number is needed by the government, and that the IRS will have access to passport form data.
UBS and Credit Suisse, with substantial commercial operations in the US, appear likely to comply with Fatca, but they are already known to have refused several US citizens as private clients.
Some US citizens, such as one who recently moved to eastern Switzerland, have had no trouble opening a Credit Suisse current account, but the bank knew she was a long-term employee for a major Swiss multinational. Her spouse, without that corporate guarantee, is unable to have a bank account of his own and the couple were unable to open a joint account.
The path to the bank’s door was smoothed by a relocation agent, who is Swiss, and was pointed out to the bank that this was a local hire, with a big company behind it. The agent insisted that the American understand her US tax obligations, in particular the FBar filing requirement, to the point where she worried about sending it, unregistered, to a post office box in the US, the only address the Detroit office supplies.
Buying a home or investing through her Swiss bank may not be options, although the bank has not said there are restrictions, but at least if she is turned down she will know in advance, unlike US citizens with mortgages and retirement funds who have been told their accounts are being closed by their local, long-term banks, which happen to be Swiss.
ACA is holding its annual gala auction in Geneva 18 March 2011.
ACA is seeking testimony from US citizens who have had trouble opening or keeping their non-US bank accounts.
Australia creates flood tax
Displaced Afghan refugee Gul Hassan is taking refuge on a road side near Hajizai Afghan refugee village which was destroyed by recent floods; August 2010 (UNHCR / R. Ali)
Geneva, Switzerland (GenevaLunch) - Monsoon floods that devastated Pakistan in 2010 continue to cause extreme hardship in the face of a funding shortfall, the International Organization for Migration (IOM) in Geneva says.
“This natural disaster, unprecedented in terms of destruction of housing and infrastructure, has necessitated an unprecedented response,” the IOM notes in a statement issues 27 January.
The UN agency coordinates some 300 agencies and NGO (non-governmental organization) groups involved in the Shelter Cluster programme to re-house people in the region.
It says international donors have contributed US$1.1 billion or 56 percent of a UN appeal for US$1.96b launched in September 2010. Agencies in the Shelter Cluster appealed for US$322 million and have received US$126m or 39 percent.
Some 11 million people were left homeless, with 1.7 million houses destroyed. Punjab province alone saw twice as many people lose their homes as did in the 2010 earthquake in Haiti. Those caught by the floods include Afghan refugees.
Millions have been helped but “unless more funding is forthcoming, at least half a million families who lost their homes and need help to rebuild either a one-room or a transitional shelter will receive nothing,” according to the IOM.
Canton’s S&P financial rating up
Generous amnesty could bring in more revenues
Geneva, Switzerland: partly cloudy skies for those who fail to pay taxes
Geneva, Switzerland (GenevaLunch) – Geneva’s rating by Standard & Poor’s has risen from A+/stable to AA-/stable, the Tribune de Geneve reported Thursday 23 September, good news for taxpayers, but the bigger tax news came late Thursday night when the cantonal parliament voted in favour of a tax amnesty that would allow a 70 percent reduction in taxes that should have been filed in 2009 if they are filed by the end of 2011.
There are two catches, with the first a legal requirement for citizens to be allowed vote on the matter. The second is that some deputies, including the canton’s financial boss, David Hiler, believe the law flies in the face of Swiss law because the reductions are greater than those allowed by federal law.
The canton has received CHF133 million in amnesty revenues since the start of 2010, the Tribune quotes Green party member Sophie Forster Carbonnier as saying.
Bruegger’s Bagels customers in New York State face an additional charge if they take their bagels out sliced, with cream cheese on top, or if they eat them on the premises. New York State, essentially broke, is enforcing a little-noticed law that distinguishes between essential food items and luxuries. A bagel sliced and topped with cream cheese immediately becomes a luxury item, subject to a seven cent tax.
The owner of the franchise, which sells bagels in 33 locations across New York, was audited by the State tax authorities and handed a fine and ordered to start to collect. To show that he was not charging customers for cutting their bagels, he put up signs in the stores.
Links to other sites: Reason, Wall Street Journal, WRGB News
Wood chips may not be the best alternative for bikers
Bern, Switzerland (GenevaLunch) – The Swiss parliament is considering abolishing the annual CHF5-10 bicycle tax/license, which provides third party insurance coverage for riders, reports 20 Minutes (Fre). The administrative costs of the license, which is obligatory in Switzerland, outstrip the revenue, argue centre- and right-wing parties, while the Socialists say the 10 percent of the population that does not have third-party insurance is the poorest, and this would leave them more unprotected. Some lawmakers have argued in favour of keeping the tax, saying the stickers help police identify stolen bicycles.
Geneva alone had more than 3,000 bicycles stolen in 2009, and the recovery rate is low, recently published police figures indicate.
Michael Ambuehl, Switzerland's State Secretary for International Financial and Tax Matters
Bern, Switzerland (GenevaLunch) - Michael Ambuehl has been named Switzerland’s State Secretary for International Financial and Tax Matters, head of a new secretariat within the Federal Finance Department. Ambuehl is probably best known as the man who negotiated the UBS arrangement with the United States Justice Department in early 2009. The new secretariat “will serve the purpose of reinforcing Switzerland’s international position in financial and tax matters,” the official announcement states.
The new office will be responsible for Switzerland’s interests in the International Monetary Fund and in the Financial Stability Board, and it will “actively participate in international efforts to combat financial crime. Moreover, it will analyze developments in the financial markets in Switzerland and abroad, and will further develop legislation concerning the financial sector.”
Ambuehl is thus charged with overseeing Switzerland’s ambitious project to play a more aggressive role in international finance and tax matters, as it tries to shed a reputation as a tax haven, which the Swiss say is largely a misperception.
Paris, France (GenevaLunch) – France’s autoroute companies will, for the first time in recent years, coordinate the announcement of changes in toll booth charges that will go into effect in February. The new rates for motorway driving in France will be announced 27 January. In early 2009 drivers of light vehicles saw their rates increase by 3 percent, while they went down 13 percent for trucks. This year rates are expected to rise in order to finance major roadworks, according to an official cited by newspaper Le Figaro.
In related news: Swiss and French drivers who have ignored parking fees when they crossed the border could find it is harder to duck paying, with the two countries’ agreement to help each other in this area going into effect this month.
Nyon, Switzerland: keeping streets clean will mean a bag tax
Nyon, Switzerland (GenevaLunch) – The Nyon city council has voted to charge CHF1.80 per 35 litre garbage bag in order to bring its finances in line with Swiss federal law governing municipal financing. Nyon currently raises funds by levying a tax on water consumption. This will now change to a flat rate of CHF126 per household plus the new garbage bag tax.
The US House of Representatives is including in its proposed healthcare package a 5.4 percent surtax on income for anyone earning more than $1 million, according to Reuters. An earlier figure for a possible surtax was 3 percent. The House presented its 1,000-page bill Tuesday 14 July and is pushing to get it passed by August. The bill was written after months of negotiations with the Obama administration. A US Senate bill to reform the healthcare system is moving more slowly. Once passed, the two houses will work on a compromise package. CBS News
Bern, Switzerland (GenevaLunch) - The CHF5 you now pay if you’ve rushed onto a Swiss train without buying your ticket in advance will go up to CHF10 on Switzerland’s national day, 1 August. The CFF rail company and public transport authorities have agreed to the increase in order to discourage the growing number of people who get on trains without a ticket, slowing down ticket-checkers and making it difficult for them to complete their tour of the train.
Bern, Switzerland (GenevaLunch) – Relations between Switzerland and Germany, already tense over the issue of banking secrecy and German taxpayers, appear to be worsening despite Switzerland’s announcement last week that it would relax its strict interpretation of the country’s law covering secrecy and fiscal information exchanges.
Bern, Switzerland (GenevaLunch) – International sports federations and their affiliated federations will be exempt from paying Swiss federal income tax, the Swiss Federal Council has decided, in a move intended to strengthen the country’s role as a leader in international sports administration.
