Home > Prestigious Swiss Private Bank Wegelin withdraws from U.S. market
Prestigious Swiss Private Bank Wegelin withdraws from U.S. market
by Open-Publishing - Tuesday 25 August 20091 comment
Trade-Exchange Rates Europe USA
Prestigious Swiss Private Bank Wegelin withdraws from U.S. market
25.08.2009
The St. Gallen financial institution is planning to withdraw from the American capital market. Partner Konrad Hummler criticized U.S. President Barack Obama sharply.
The planned tightening of the QI regime (U.S. withholding tax) by the U.S. government and the extent of the estate tax obligation meant a considerable legal uncertainty, the bank said on Tuesday.
The condition is untenable, is Konrad Hummler, Managing Partner of Private Bank, quoted in the statement. The government of the once most vibrant market economy, obviously know their own Achilles heel, and not worrying committing errors.
Unreasonable legal risks
The business model of Transgression asset, at least in the U.S. relates to persons, should be revised. Obama’s government was planning not only all the tax loopholes against Americans to fill it. Rather, a significant expansion of the tax on non-Americans in the pipeline, writes the private bank.
First and foremost, the revision of the "Qualified Intermediary" leads - Agreement to undue legal risks for the Swiss banks. You would have to function as an arm of the U.S. tax authority will be able to see who was taxable in the United States. That is, given the almost boundless, totally vague definition of effective taxation is an impossible task.
Risk is too great
In the future, would not only American citizens but also foreigners about the U.S. asked to pay inheritance tax, writes Wegelin & Co. The only requirement is an American value of Scripture in the depot. The danger of an innocent Fehldeklaration by banks to the IRS, would be too large.
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26 August 2009, 12:07
Wegelin bank to pull out of US
Swiss private bank Wegelin announced on Tuesday that it is to stop doing business in the United States.
The St Gallen-based bank, Switzerland’s oldest, said the decision had been taken in response to stricter measures introduced in the US against tax dodgers and planned changes to estate tax, which would make some non-US citizens liable to tax if they inherited US securities.
In a letter to investors it said Swiss banks were likely to find themselves in an untenable position, as they would be expected to know which clients were liable to pay US tax – "an impossible undertaking", given the lack of clear definitions in the matter.
The danger of inadvertently making false declarations to the US tax authorities will be too great, it explained.
It added that it believes the US overestimates its attraction as a financial centre, and is advising its clients to get out of all US securities.
The decision comes a week after US tax authorities reached a deal with the Swiss government which will see bank UBS hand over details of almost 4,500 suspected tax cheats.
http://www.swissinfo.ch/eng/news_digest/Wegelin_bank_to_pull_out_of_US.html?siteSect=104&sid=11125453&cKey=1251233629000&ty=nd