“Banking secrecy.” Luxemburg announced on 07 Apr 2013 that they intend to relax their banking code of silence, “no longer strictly refusing” to automatically share information about international accounts with other countries’ tax authorities, starting in 2015. EU countries have also been in negotiations with Switzerland about similar issues for several years, though individually as separate countries and not with the full power of the EU.

Until now, foreigners banking in Luxemburg have paid an anonymous tax of 35% on interest earned there. This will be changed in Luxemburg e.g so that account holders’ names will be included in the information shared with German tax authorities.

German critics say this is insufficient because other Luxemburg income, such as company profits, remains untaxed for foreigners. Also, Luxemburg isn’t the only European tax oasis. Jürgen Trittin of the Green Party criticized Austria, for example, where names of foreign account holders earning interest in Austrian banks are only shared after initiation of criminal proceedings. Green Party finance guy Gerhard Schick wrote that the G20 summit in 2009 actually agreed to end Bankgeheimnis; certainly some reforms were enacted that year though movement has been slow since, until the recent data leak. The ZDF report concluded by saying that economists have warned that if only some tax oases reform their laws, the ones that don’t will profit from acquiring fleeing customers.

Update on 09 Apr 2013: “In principle, Liechtenstein has separated itself from its tax haven past.” Speaking of Liechtenstein, it looks like they had an interesting idea for a new field for financial services experts in former tax oases to move into: ratings agencies that are independent of the big three on Wall Street. The nonprofit Carlo Foundation (carlofoundation.org), said to be the world’s first independent fund rating agency, was founded in Liechtenstein in July 2012.

(BONK geh HIGH mniss.)