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Austrian report
by Euro Reporter
2014-06-03 09:23:52
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Austria sees record arrivals from Mideast

New luxury hotels, shopping areas and family attractions should secure Austria’s position as the fastest-growing European destination in the Middle East this year. With an increase of 612 per cent in guests from the Middle East in 10 years alone, Austria has been the fastest-growing European market for the region. Last year was yet another record year (fourth in a row), with an increase of 23 per cent resulting in 268.476 arrivals and 872.571 overnights from the Middle East. The first quarter of 2014 indicates a continuation of this trend with a growth of 29 per cent in arrivals and 19 per cent in overnights so far.

For Austrian tourism, the Middle Eastern market has become increasingly important. The biggest volume of total growth in 2013 came from Germany, China and the Middle East. Austria boasts many positives that the Middle Eastern traveller craves - moderate climate, Alpine nature with crystal-clear lakes, green grass and snow-covered mountain tops, romantic city centres with ample shopping facilities and many family attractions.


Pressure mounts on Austria to step into line on tax evasion

Banking secrecy for Austria is “a sort of Holy Grail”, says Bruno Rossmann, a Green party politician in the federal parliament and a specialist in tax affairs. He is referring to the country’s longstanding reluctance to adopt international measures on the exchange of account information. “Parts of the law are at the constitutional level,” meaning a two-thirds majority is needed in parliament to enact changes, he says. Indeed, in April 2013, Maria Fekter, then Austria’s minister of finance, promised to “fight like a lion” to defend the culture of silence on banking – a culture critics say makes Austria a haven for tax evasion for individuals from within and outside the EU. Ms Fekter’s comment prompted Nicholas Shaxson, a researcher with the Tax Justice Network, a campaign group, to blog: “Given the prevailing international pressure towards transparency, [Ms] Fekter is pushing against a powerful tide of history-in-the-making. She is refusing to see the obvious.” Rather than a lion, Ms Fekter was more like an “ostrich ... as she certainly has her head in the sand”. Mr Shaxson appears to have had the last laugh. Barely a year later – stung by a report from the OECD, which judged the country only “partially compliant” with international standards on tax transparency – Austria has agreed to measures that should bring it more into line with best international practice.

In March, it agreed to switch to an automatic exchange of account information within the framework of the EU savings directive. In April, it signed up to comply with the foreign account tax compliance act – Fatca – the 2010 US law designed to combat non-compliance by US taxpayers with foreign accounts.  This month, Austrian lawmakers passed legislation giving foreign tax authorities easier access to account information where criminal activity is suspected. A finance ministry spokesman says that Michael Spindelegger, the finance minister, “has brought to an end the long-lasting gridlock between the European Commission and Austria over the savings directive. He has made big efforts to ensure the compliance of Austrian rules with international standards in fighting tax evasion.” But, as Mr Spindelegger has told the media the measures will not violate Austria’s bank secrecy laws, it is uncertain how substantive the changes are. For Mr Rossmann, the conditionality tied to the agreement with the EU is a potential stumbling-block and certainly buys time before implementation. On the EU savings directive, the probability is that Austria will make a start from 2017, but, says Mr Rossmann, “only on condition that other countries [with bank secrecy laws], such as Switzerland, Liechtenstein and San Marino also start the exchange of information and that this is based on common OECD standards [now being established]”.

Yet within the EU, Luxembourg – which has joined Austria in fighting moves to greater transparency – has agreed to begin the exchange of information from 2015. “Austria will be the last [EU] country to start. This is intolerable,” Mr Rossmann argues. Nor is Austria’s signature on the Fatca quite what it might be, says Martina Neuwirth, an international financial and trade policy specialist at the Vienna Institute for International Dialogue and Cooperation. It adheres, at least in form, to banking secrecy, but is the only EU member to sign up to the model 2 Fatca, which restricts exchange of individual data to a cumbersome request process, rather than making it automatic. Ms Neuwirth says: “It is ridiculous. Every time it gets more difficult [to legislate] everything around this damned banking secrecy, just because they do not want to change it, or even starts a public debate.”  Even the amendment giving foreign authorities easier access to account information for criminal investigation purposes may prove problematic. Mr Rossmann comments: “Austria could start the exchange of information immediately, but the government has no interest. By delaying, Austria hinders the EU common efforts on tax evasion and tax fraud. In that sense Austria is not doing enough.”


Austria's Freedom Party sees vote rise

In Austria, there were big gains for the far-right Eurosceptic Freedom Party, which came in third place with around a fifth of the vote. The anti-immigrant Freedom Party, which campaigned with slogans such as "Too much EU is dumb," picked up four seats, two more than in the last election. It has said it was hoping to form an alliance with France's National Front and other like-minded parties in the new EU parliament.

Freedom Party leader, Heinz-Christian Strache, arriving at his election celebration, said: "We have made strong gains all over Europe." But analysts say the overall share of the Eurosceptic vote remained reasonably stable in Austria.  They say the Freedom Party profited from the fact that another party of EU sceptics, the Hans Peter Martin List, which won more than 17% in 2009, did not run this time round.

Almost three-quarters of Austrians who turned out to vote, however, chose pro-European parties. The conservative People's Party took first place, and its governing coalition partner, the Social Democrats came second. The other winners of the evening were the Green Party, which increased its share by more than 5%, to reach 15% - and the new liberal NEOS, which got one seat in Parliament. Its slogan was "We love Europe."


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Emanuel Paparella2014-06-03 10:23:38
A tale of 2 Europes?

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