Zurich — What could lie to the left in Sunday’s German elections is scaring millionaires to move their assets to Switzerland, bankers and tax lawyers say.
If the Social Democratic Party (SPD) on the center left, the Linke on the hard left, and the environmentalist Greens come to power, the reintroduction of wealth taxes and the tightening of inheritance taxes could be political agendas.
“For the ultra-rich, this is bright red,” said a German-based tax lawyer with a large business in Switzerland. “The entrepreneurial family is very cautious.”
The move shows the number of wealthy people who see Switzerland as an attractive place to park their wealth, despite efforts to abolish its image as a safe haven for millionaires. increase.
No country has more offshore assets than Switzerland and the influx is accelerating in 2020 for the benefit of major banks such as UBS, Credit Suisse and Julius Baer. Concerns over geopolitical tensions and the economic impact of the COVID-19 pandemic have made Switzerland’s political stability attractive.
According to data from the Bank for International Settlements, German household and corporate deposits at Swiss banks increased by approximately $ 5 billion to $ 37.5 billion in the first quarter of 2021. This does not include stocks, bonds or financial instruments. More recent figures aren’t available, but insiders say the influx continues. “We have booked above average new funding, as in the last three months,” said a veteran client advisor to a major Swiss bank, which deals primarily with Germans.
“Many wealthy people, especially entrepreneurs, are afraid to hide on the left side of Germany no matter how the elections take place,” said Florian Dürselen, head of Europe for Wealth Manager LGT Switzerland. I am.
“I know a lot of German entrepreneurs who want to gain a foothold when things get too red (left) outside Germany,” said one of Switzerland’s leading bankers.
A poll on Thursday showed that SPD was 25%, leading Angela Merkel’s conservatives by four points. SPD wants to reintroduce wealth tax and raise inheritance tax, but Greens (probably a potential coalition partner) plans to tax property heavier. Both envision raising the income tax on high-income earners, but taxing assets will raise far more money, tax lawyers said.
He sees a growing demand for advice from clients, with some entrepreneurs making new investments through Swiss companies or transferring assets to the Liechtenstein Foundation. Said he tried to protect.
On the other hand, simply sending cash to a Swiss bank account is no longer useful. Under enormous international pressure, Swiss are now sharing such account data with the tax authorities in their home countries.
“Switzerland as a financial center is characterized by stability, legal security and a high level of financial capacity, but it does not provide protection against tax evasion,” said the State Secretariat for International Financial Affairs (SIF). ) Spokesman said.
LGT’s Durseren said he recently spoke with a German entrepreneur who was afraid that Germany could soon impose strict taxes on foreign assets and transactions.
“Personally, I think a lot of assets will continue to be transferred to Switzerland,” he said.
A local politician said dozens of wealthy German entrepreneurs have been inquiring about living in one of the low-tax suburbs along Lake Zurich in recent months.