Swiss demand referendum on UBS tax deal with US

Swiss politicians have again attempted to thwart a deal to give the US authorities details of thousands of Americans who hold secret accounts at UBS, the country's largest bank.

The latest move by members of Switzerland's lower house could mean the deal with the US cannot be approved before August's deadline.

Although the members voted through the deal which they had rejected last week, they sent it back to the upper house with a demand that there now be a national referendum on the move.

That means a final vote will not now be held until the end of this week, and if approval for a referendum is forced through it could take several months to organise.

The bill finally won approval from major parties the SVP and Social Democrats after debating conditions. The Right-leaning SVP demanded the rejection of calls for new corporate taxes.

The threat of prosecution looms over UBS if Switzerland refuses to hand over the names of 4,450 American clients.

Authorities have transmitted the names of about 400 UBS clients who signed waivers as part of US tax agency the Internal Revenue Service's voluntary disclosure programme, and another 100 gave their consent directly to Swiss authorities.

The remaining 3,950 files were to be held back until the Swiss parliament approved the deal.

Switzerland's banking secrecy laws normally forbid handing customer details to foreign authorities, except when there is evidence of outright tax fraud — a difficult case to prove when client files are kept confidential. The government agreed to make an exception to the rule to prevent prosecution of UBS in the US.