OECD to close in on tax havens

Berlin -

Leading industrial nations agreed on Tuesday to strengthen cooperation and take a tougher approach towards tax havens.

Ministers and representatives from 20 members of the Organisation for Economic Cooperation and Development (OECD) approved the move at a conference in Berlin.

German Finance Minister Peer Steinbrueck, who co-hosted the meeting with French Budget Minister Eric Woerth, said the agreement provided for sanctions against countries who refuse to accept OECD standards on tax issues.

Austria, Luxembourg, Switzerland and other countries accused of lacking transparency in their tax affairs attended the day-long meeting in Berlin.

The talks follow up a similar meeting held in Paris on October 21, 2008, at which it was decided to draw up a "black list" of international tax havens.

The OECD said another 40 countries had agreed to accept its standards on greater transparency and more exchanges of data on tax issues, bringing the total number to 84.

Germany has been in dispute with its Swiss, Austrian and Luxembourg neighbours over claims they were not doing enough to counter tax fraud.

On the eve of the meeting, Steinbrueck and his Swiss counterpart Hans-Rudolf Merz agreed to revise the double taxation agreement between their two countries.

Merz informed Steinbrueck that Switzerland would comply with Article 26 of the OECD Model Tax Convention. This means Switzerland will provide assistance on tax evasion cases.

- Sapa-dpa