Switzerland house rejects deal with US in UBS row

GENEVA: Switzerland’s efforts to calm a banking furore hit a major setback Tuesday as nationalist and left-wing lawmakers blocked a treaty with the United States that would have allowed UBS to hand over thousands more files on its American clients to US tax authorities.

The Swiss government and Washington had painstakingly crafted the treaty last August to resolve a long-standing dispute over the bank’s alleged role in aiding tax evasion but 104 lawmakers in Switzerland’s lower house voted against the deal Tuesday, compared to 76 in favour. Sixteen lawmakers abstained. The government had urged lawmakers to approve the deal to avert harm to the Swiss economy, which is heavily dependent on the country’s banking industry. The deal is crucial to UBS which has faced intense pressure from US authorities since 2007.