Swiss minister leans towards bonus tax -paper

* Bonus tax key for Swiss Parliament approval of UBS tax deal

* U.S. would restart legal action against bank if deal falls

ZURICH, April 23 (BestGrowthStock) – Switzerland’s Justice Minister is sympathetic
to calls for a tax on bonuses that may end a parliamentary deadlock over a tax
deal crucial to the future of banking giant UBS (UBSN.VX: )(UBS.N: ), a Swiss paper
reported on Friday.

Switzerland’s Social Democratic Party is ready to drop objections to a deal
ending a bitter U.S. tax dispute against UBS, the world’s second-largest asset
manager, if Berne introduces a tax on bankers’ bonuses. [ID:nLDE63C0TF]

“There needs to be a tax on bonuses,” Justice Minister Eveline
Widmer-Schlumpf said about the Social Democrats’ demands in an interview in
Friday’s Tages-Anzeiger. “In principle I support the Social Democrats’
requests,” she said.

But she added there may not be enough time to formally introduce new
legislation on variable compensation before Parliament votes on the UBS deal.

The votes of the Social Democrats, the Alpine nation’s second-biggest party,
could make or break the deal, struck last August, to hand over data on 4,450
clients of UBS suspected of hiding money from the U.S. tax authorities. The
bigger, right-wing SVP has said it would vote against the deal.

If parliamentarians reject the U.S. tax deal, preventing Switzerland from
handing over the client data within a year as agreed, U.S. authorities could
reopen damaging legal proceedings against the bank, Widmer-Schlumpf warned.

“The United States would use every level of escalation available to it under
the terms of the treaty,” the minister said, adding this would force UBS to hand
over client data to U.S. authorities directly, breaking Swiss bank secrecy laws.

Large bonus packages have angered many Swiss voters and investors after UBS
booked the biggest annual loss in Swiss corporate history and needed taxpayers
to dig deep into their pockets to help it in 2008.

UBS and Credit Suisse stoked these heated tempers further last month by
awarding top bankers multi-million dollar bonuses.

A source close to the Finance Ministry told Reuters earlier this month that
the ministry would consider putting a ceiling on how much bankers’ pay can be
charged as a cost before corporate income tax.

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(Writing by Jason Rhodes; Editing by Rupert Winchester)

Swiss minister leans towards bonus tax -paper