EU optimistic on savings tax progress

The European Union's tax tsar said today he was confident of agreeing a system to tax savings in the EU despite wrangling over…

The European Union's tax tsar said today he was confident of agreeing a system to tax savings in the EU despite wrangling over a deal 10 years in the making.

In December, EU finance ministers held two meetings on a deal to fight tax evasion by eventually swapping data on bank accounts so that savers can be taxed where they live.

Although the talks failed, European Internal Markets Commissioner, Mr Frits Bolkestein, saw progress ahead.

"It is altogether a fairly complicated picture, it is a jigsaw puzzle, but once again after the second Ecofin [economic and finance] meeting that we had in December I am relatively optimistic about further progress after the Ecofin on January 21st," he said.

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Finance ministers are due to tackle the issue again at their January 21st Ecofin gathering.

Under a compromise discussed in December, states that want to protect their banking secrecy - including Belgium and Austria - can choose to impose a withholding tax on interest paid on foreign accounts for an interim period from 2004 to 2011.