Financial Crime World

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Switzerland Slides to Second Place in Global Tax Fraud Ranking, Report Reveals

A new report from the Tax Justice Network has shed light on Switzerland’s notorious reputation for banking secrecy and tax evasion schemes. The country has climbed to second place in the global ranking of nations that facilitate tax fraud, money laundering, and financial secrecy.

Financial Secrecy Index 2022

The Financial Secrecy Index 2022 compiled by the Tax Justice Network ranks countries based on:

  • Their levels of financial secrecy permitted in banks and government
  • The size of financial services provided
  • The supply of global financial secrecy

Switzerland has moved up to second place from its previous ranking of third in 2020.

Criticism of Switzerland

The report criticized Switzerland for:

  • Lack of transparency in company ownership, recording, and publishing
  • Failure to disclose business tax payments publicly
  • Banking culture that facilitates tax fraud, with Swiss banks holding accounts for alleged dictators and criminals

Improvements and Exported Financial Services

Despite these criticisms, the report noted some improvements in Switzerland’s efforts to exchange financial information with other countries, particularly those within the OECD and Council of Europe. However, the country still exported over $21 billion worth of financial services since 2020, accounting for a disproportionate 3.9 percent of total global financial service exports.

Top 10 Worst Nations for Tax Fraud

The top 10 worst nations for tax fraud are:

  1. United States (25.8% of financial services exported since 2020)
  2. Switzerland
  3. Singapore
  4. Hong Kong
  5. Luxembourg
  6. Japan
  7. Germany

Conclusion

The Tax Justice Network’s report highlights Switzerland’s continued complicity in global tax evasion schemes. The country must now take concrete steps to address these issues and ensure transparency in its financial dealings.

Note: The article originally included a date for the G7 finance ministers meeting, but I removed it as it may have changed since the original publication date.