U.S. Markets close in 2 hrs 23 mins

German opposition seizes on prominent tax case

BERLIN (AP) -- Germany's opposition seized Sunday on a case of suspected tax evasion involving a prominent football figure to attack the government before this year's elections over its attempt to settle a tax dispute with neighboring Switzerland.

Bayern Munich president Uli Hoeness was quoted over the weekend as telling the weekly Focus that he reported himself to authorities regarding a Swiss account after originally hoping to resolve the matter under the planned tax deal.

The center-left opposition controls parliament's upper house and last year blocked the agreement, which it said was too soft on tax cheats.

It would have allowed Germans with undeclared assets in Switzerland to escape punishment by making a one-time payment of between 21 and 41 percent of the value of those assets, and to remain anonymous.

The Hoeness case "shows that this German-Swiss tax agreement was always badly negotiated," Peer Steinbrueck, Chancellor Angela Merkel's challenger in September elections, said on ZDF television.

"Mr. Hoeness, like many others, trusted that 'it will be signed and so I can remain anonymous and will effectively be legalized retroactively,'" Steinbrueck said.

Joachim Poss, a senior lawmaker with Steinbrueck's Social Democrats, said "the Hoeness case shows how right the (party's) strategy was."

"He will not remain the only one whose hopes in the government's agreement will now be dashed," Poss said. The Social Democrats have backed purchases of CDs containing bank information on potential tax cheats.

The government says the deal would have ensured that all tax cheats were made to pay up, bringing more money into German government coffers and soothing a long-running irritant in German-Swiss relations.

Steinbrueck's party, which has made narrowing the gap between Germany's haves and have-nots a key issue in its campaign for elections in September, currently trails in polls.

It wasn't immediately clear how much money might be involved in the case of Hoeness, a former Bayern Munich player and member of West Germany's 1974 World Cup-winning team who is also a successful businessman and sausage factory owner.

Reporting oneself to tax authorities can mitigate any punishment. Munich prosecutor Ken Heidenreich was quoted as telling Focus that his office is conducting an investigation of suspected tax evasion on the basis of Hoeness' report, which it is evaluating. Bayern Munich, the recently crowned Bundesliga champion, isn't commenting.