There's a simple solution to the tax problem: charge a flat tax rate on gains on "secret" assets, levied by the financial institutions to which they have been entrusted. Many countries do this (I'm fairly sure Switzerland is among them) [1]. A problem only arises when the home country gets greedy and wants a piece of that tax pie. I'm sure you could come up with some system by which the destination of the money is estimated and the aggregate taxes paid to that country, but that's probably not seen as enough.
[1] Austria uses a system like this - capital gains are flat-taxed at 25% unless you choose to declare them together with other income, falling under income tax (you'd be pretty stupid to do this considering the lowest income tax rate here is 36.5%, but that's another matter). This frequently causes the OECD and the US (the only country to tax its non-resident citizens, as far as I know) exert pressure on Austria (and Switzerland) to try to get them to drop banking confidentiality; they've had some success lately, privacy has been somewhat eroded.
Switzerland already does this. EU members were pressuring them to release bank information (they aren't part of the EU but are completed surrounded by it). So the new compromise is they don't release the bank records but the pool all the money each country is supposedley owed and forwards it to them.
The problem is the other countries don't trust the swiss. They are basically being handed a bag of money and being told trust us. Underreporting taxes benefits the 2 parties with all the information (the swiss and their account holders) and the 3rd is left totally in the dark.
That's the ESD (Europen Unions Saving) directive which Switzerland agreed to. So (I think 35%) now of interest related gains is anonymously delivered with a wink to the country where the secret account holder resides.
Here in Denmark tax authorities have used that anonymous amount transferred to estimate amount of money in Swiss banks which is supposedly enormous.
They've also gone further, like confiscate data about years of foreign credit card payments by Danish shops and search out anyone using a card from a foreign tax haven country based on e.g. shipping addresses for online shopping, or address supplied for hotels and airplane tickets. Except a few high-profile cases like a famous golf player, this had curiously limited criminal consequences, seems like 98% of those caught where just told to pay the tax and interest on the suspicious amounts.
The next step in the tax fraud battle is analysis of all bank payments from Danish bank to any bank in tax haven countries.
The credit card analysis was done in Sweden previously, so it wouldn't surprise me other countries started using that method as well.
I can't help but wonder in what relation the resources invested into tracking all of this down are vs. reclaimed tax (or lost tax revenue if they just simplified/reduced the domestic tax rate - don't forget there's a currency exchange rate risk associated with shipping your money out to Switzerland).
> don't forget there's a currency exchange rate risk associated with shipping your money out to Switzerland
Actually, there isn't. You can have accounts denominated in USD, JPY, EUR or any other sufficiently mainstream currency. It's even free if the amount is big enough, which is actually not that high (low five figures).
Don't worry about the banks though, they make it all back and more in their ludicrous transaction fees.
[1] Austria uses a system like this - capital gains are flat-taxed at 25% unless you choose to declare them together with other income, falling under income tax (you'd be pretty stupid to do this considering the lowest income tax rate here is 36.5%, but that's another matter). This frequently causes the OECD and the US (the only country to tax its non-resident citizens, as far as I know) exert pressure on Austria (and Switzerland) to try to get them to drop banking confidentiality; they've had some success lately, privacy has been somewhat eroded.