Swiss bank accounts!

It would seem that the powers that be are on the brink of a remarkable climb down in their proposed fishing expedition to find out which UK nationals have Swiss bank accounts, determine the interest missing from their UK return and hammer them for tax, penalties and interest.

In a nutshell:

1. The UK will grant a complete tax amnesty to holders of Swiss acounts - no tax to pay on interest credited.
2. In future the Swiss authorities will have the power to determine and levy a withholding tax on interest credited to UK nationals. I assume the Revenue will stay in Switzerland?

In other words it would appear that the UK has just done the following:

1. Granted Switzerland the right to set the effective higher rate of tax on investment income in the UK;
2. Granted Swiss banks an everlasting competitive advantage over UK banks – because it will pay all higher rate tax payers to bank in Switzerland henceforth;
3. Denied the UK tax authority the right to make enquiries of their own choosing about the tax affairs of a British person – the Swiss now being granted the right to decide how many enquiries may be made and whether they are appropriate or not.

Which sort of rankles when you consider, for example, the reduction in tax relief in the UK for pension contributions next year, et al...