Swiss, Germans sign tax deal

Switzerland and Germany signed on Thursday a revised tax accord toughening up penalties on tax cheats after several German states rejected the original deal. Under the accord, tax evaders will pay slightly more but their anonymity will be preserved, the German finance ministry said. The two countries signed a deal in 2011 giving German taxpayers a one-off chance to make an anonymous lump sum tax payment, with the tax rate to vary between 19 and 34 percent of the assets. That will be raised to between 21 and 41 percent after some German states rejected the first deal, saying it was too lax. From 2013, a withholding tax of 26.375 percent -- the same as in Germany -- will also be levied on all future investment income and capital gains arising from assets held by German taxpayers in Switzerland. In Germany the Greens and Social Democrats vowed to block the ratification of the "cut price" deal. The accord aimed to end a dispute between the two neighbours that blew up into a major spat in July 2010 when German authorities raided branches of Credit Suisse bank after buying data on suspected tax dodgers.