As Taxes Rise The Rich Move To Switzerland

Recently Switzerland decided to cooperate with U.S. and other neighbor countries on the issue of tax evasion. However, it has not stopped people moving in to Switzerland for tax purposes and the country still is in demand for those who are able to take up resident in this Alpian beautiful part of the world.

Alexander Zeller, the CEO of HSBC's Swiss bank, tells Bloomberg that they are not talking about thousands of people because they are talking about people with a certain wealth. Yet, those numbers are significant Zeller said in an interview in Zurich. “They come above all from countries which have substantially increased taxes. There’s a direct correlation between taxes and the desire of a wealthy person to want to establish themselves elsewhere.”

Zeller also said that currently any Swiss banking client with a tax-compliance issue in his own country has basically three choices. The first is that the client doesn't have to do anything. The second is that the client can make a voluntary disclosure. The third is that if the banking client is very rich, he or she can move to live in Switzerland.

"Switzerland is home to expatriate millionaires including seven-time Formula 1 racing champion Michael Schumacher, Ikea founder Ingvar Kamprad and singer Tina Turner. Wealthy residents who don’t have Swiss income can negotiate individual tax deals with regional authorities in Switzerland," writes Warren Giles in today's Bloomberg.

Next year, starting in April, the United Kingdom plans to levy a 50 percent income tax on rich people who make more than 150,000 pounds ($244,000) a year. This has created a difficult situation for the rich. Zeller says the solution may be to move to Switzerland.

Switzerland offers some of the best living standards in the world. Political and fiscal stability have made the country an attractive residential destination for many rich and famous people.

Written by Armen Hareyan
Materials from Bloomberg are used in this story.