Switzerland: Offshore Business Sectors
Switzerland's well-known attractions as a home for money are based on its widely perceived safe haven status. This is a direct consequence of its ironclad banking secrecy provisions, the ever-appreciating value of the Swiss franc, and the country's long history of neutrality which has kept Switzerland free from the ravages of war and given it a political and economic stability unrivalled in continental Europe. More recently the country's continued demurral from joining the European Union has made it a major beneficiary of investment funds fleeing high taxation and the effective ending of banking confidentiality in EU countries due to the Savings Tax Directive.
The Savings Tax Directive applies in Switzerland through a separate agreement reached between the country and the EU, under which Switzerland applies a withholding tax (35% since 1st July 2011) to returns on savings paid to the citizens of EU member states, and which in various other ways is less onerous than the original Directive.
Although bank interest and dividends are caught by the Directive, payments made by what are called 'residual agents' (including for instance trusts) are apparently excluded in the Swiss agreement, which is not the case in EU member states.
This section of the site describes the key Swiss banking and investment fund sectors.