The European Commission yesterday said an offer by Switzerland to help the EU fight tax cheats was a step in the right direction that might help EU ministers wrap up a deal on taxation of savings today. The 15-nation EU is striving for agreement on how to stem cross-border tax evasion before a year-end deadline.

But the deal is linked to Switzerland lifting its treasured bank secrecy, the foundation of a wealth management industry worth over 3,000 billion Swiss francs (€2,036 billion).

Although refusing to give up bank secrecy completely, Berne has offered to impose a withholding tax on income from savings held by EU residents and to exchange data on EU citizens' bank accounts in limited circumstances.

EU finance ministers are due to decide whether Switzerland's final offer satisfies the EU's request for help at a specially called meeting today. "We have had clarifications from the Swiss which we think are certainly a step in the right direction in terms of making the package of measures offered to be a good package," Commission spokesman Mr Jonathan Todd told a news conference.

Austria, Belgium and Luxembourg, due to give up their own bank secrecy laws, are wary of endorsing the tax package without similar measures from rival non-EU financial centre Switzerland. The EU is also expecting co-operation from the United States and micro-states Monaco, Andorra, San Marino and Liechtenstein.

Following a request from Belgium, the meeting should also see Britain clarifying whether its dependent territories, which include the Cayman and Channel Islands, would fully share information with EU partners and from when. - (Reuters)