The Senate voted on Tuesday to keep New Zealand on a list of countries with which Switzerland will practice the Automatic Exchange of Information (AEOI), despite the problems that this may pose to retired Swiss in the southern hemisphere country.
Senators thus went against an earlier decision by the House of Representatives, who want to make two exceptions from the list of 41 countries with which Switzerland is planning to share banking details – Saudi Arabia and New Zealand.
On Wednesday the House of Representatives followed the Senate's decisions, reversing its previous opposition to exchanging tax information with the two contentious countries.
The reason for the reticence involves the 7,000 retired Swiss in New Zealand, some of whom have been grumbling about Wellington’s practice of deducting foreign pension incomes from those paid out nationally. They want to use the AEOI debate to bring about change, such as a social insurance treaty between the two countries.
Others have even more pressing concerns: if AEOI comes into effect, it could reveal that some Swiss have been hiding pension money from Wellington authorities – which would lead to higher deductions and charges of tax evasion.
In the Senate on Tuesday, Filippo Lombardi, vice-president of the Organisation of the Swiss Abroad, criticised the “plundering” practiced by New Zealand and demanded that the introduction of AEOI be linked to changes in social insurance practices.
Others disputed this, saying that the AEOI issue should not be confused or taken hostage by the pensions debate.
In compliance with the JTI standards