GENEVA: Czech Foreign Minister Karel Schwarzenberg defended Switzerland yesterday against threats by EU member states to put it on a tax haven blacklist, saying sovereignty is "worth more" than lost taxes.
"Certainly tax coffers here and there miss out on a couple of million euros... The independence of a country and the traditions of an independent, neutral Switzerland is however worth more than that," Schwarzenberg said.
"Why must one spoil that at all cost?" he said.
The Czech Republic holds the rotating presidency of the EU, and Switzerland has come under intense pressure in recent months over its banking secrecy laws.
Switzerland also distinguishes between tax evasion, which is not a crime, and tax fraud, a criminal offence that involves forgery of documents. Critics say these provisions encourage tax evaders to hide assets in Swiss banks.
France and Germany are pushing for an international blacklist of tax havens to be drawn that would punish countries seen as uncooperative by having leading economies break off fiscal agreements with them.
Asked after an EU summit in Brussels in February whether Switzerland could be on the blacklist, French President Nicolas Sarkozy replied: "That depends on their response. But as things stand ... the answer is probably, yes."
Amid the pressure, Finance Minister Hans-Rudolf Merz will meet his Austrian and Luxembourg counterparts to "co-ordinate points of common interest," said an official statement, with the tax haven blacklist threat to be discussed.
The country's biggest bank UBS has also come under scrutiny due to a widening tax probe in the US.
In February, UBS provided information on up to 300 clients to the US government and paid a fine of $780 million to settle a case in which it was accused of abetting tax fraud by US clients.
The US government has since filed a separate lawsuit to try to force UBS to disclose the identities of 52,000 US customers who allegedly evaded taxes.
Swiss ministers have described the US moves as an "attack" on Switzerland.
Swiss Justice Minister Eveline Widmer-Schlumpf said that the US "did not keep to playing rules" by seeking these names.
"The US has now started a fishing expedition by demanding the 52,000 client data. That goes against constitutional principles. I have reflected this to my American colleague... We view this as an attack on Switzerland," she said.
