European Union finance ministers have agreed controversial proposals setting Europe-wide rules for the taxation of income from individual savings.

Under a compromise proposal 12 of the EU's 15 member states will exchange information on income earned by EU residents in other member states. Austria, Belgium, Luxembourg and non-member Switzerland, which objected to giving up their banking secrecy, instead will impose a withholding tax rising to 35% of the taxable income. Switzerland's participation in the scheme depended on all EU states agreeing to the new rules.