By John O'Donnell and Robin Emmott
BRUSSELS (Reuters) - European Union finance ministers gave the green light on Tuesday to start talks with Switzerland and Liechtenstein about surrendering bank data, as Europe stepped up its fight against tax evasion.
The move, described as 'historic' by Germany's Finance Minister Wolfgang Schaeuble, redoubles pressure on Switzerland to open up account details and will likely pave the way for Austria to ditch its own bank secrecy for foreigners.
By giving the European Commission the go-ahead to negotiate with Switzerland, Liechtenstein, San Marino, Andorra and Monaco, EU finance ministers hope to push for the same rules to be applied to these countries as within the European Union.
The talks had long been opposed by EU members Luxembourg and Austria, which were seeking to defend their own bank secrecy, but on Tuesday their finance ministers dropped those objections.
"In the battle against tax evasion, what we achieved today was undoubtedly a step forward," Algirdas Semeta, the European commissioner in charge of tax policy, told reporters after the meeting of ministers.
The Swiss government gave a guarded response. A spokesman for Switzerland's department of finance underscored the country's willingness to cooperate and said it would now consider how to respond.
Austria's support is a symbolically important gesture that takes it closer to ending its own bank secrecy for foreigners, bringing it into line with the rest of the EU.
Most developed countries share information on taxpayers and depositors "on demand". But since this requires the authorities in the requesting jurisdiction to suspect wrongdoing, it only has limited impact in uncovering unlawful behavior.
Automatic exchange of information allows tax authorities to more easily spot tax evasion or illicit money flows.
Austria has been the last EU holdout on bank secrecy after Luxembourg changed tack last month.
"This is a huge step further for Austria," Finance Minister Maria Fekter told her peers in part of the meeting of EU ministers that was broadcast.
Austria has yet to sign up to that EU bank information exchange but Fekter's comments indicate this may change.
Last month, Luxembourg said it would lift bank secrecy rules for European Union citizens who have savings based there.
Its decision followed lobbying by Germany, bolstered by the case of former French budget minister Jerome Cahuzac, who is under investigation for fraud after admitting lying about having a Swiss bank account.
Earlier on Tuesday, Austria's Chancellor Werner Faymann told reporters that it was important to crack down on tax cheats to ensure everyone pay their fair share at a time of tight budgets.
Seventeen of the EU's 27 members, including Britain, France and Germany, said in a joint statement in Brussels they were pushing for a global standard on bank information sharing to tackle tax evasion. "There is now real momentum building towards a step change in the international community's approach to tackling evasion," a British diplomat said.
(Additional reporting by Jan Strupczewski, Annika Breidthardt and Mike Shields in Vienna; Editing by Susan Fenton, Ron Askew)