Europe

First came the Germans and then came the Brits. The UK Treasury has secured an agreement with authorities in Zurich to tax the assets of UK citizens held in Swiss banks to reduce on tax avoidance and stamp out evasion. The deal will follow the lines of that which Switzerland made with Germany last month. The FT has details: 'Taxes on future income will be withheld at a rate of 48 per cent, corresponding to the top 50 per cent rate that now applies to Britain’s highest earners. A one-off levy of between 19 and 34 per cent will be applied to all Swiss accounts held by UK residents, with the exact percentage to be determined by the size of the deposit and how long it has been maintained.

Angela Merkel must tire of repeating herself. Eurobonds are “exactly the wrong answer” to the European debt crisis, she said yesterday for the umpteenth time. She added that they would “lead us to a debt union not a stability union”, a free-for-all funded by German taxpayers. She concluded that “greater commitment” from the 27 member states of the European Union was required to stabilise the situation. Her comments would have, perhaps, placated her mutinous coalition in Germany, which is virulently opposed to Eurobonds and expensive integration.

It's no surprise that 70 Tory MPs have formed a Eurosceptic group, as the Sunday Telegraph reveals today. They are the modernisers now. The new Tory intake are strikingly robust on all this: by and large, their idea of political balance is a picture of Thatcher on the wall and Jacques Delors on the dartboard. The impending boundary review and thinner-than-they-expected majorities mean they worry more about their constituency (and constituency associations) than the whips. But I'm told today that this rebellion isn't quite as fierce as it may seem. One Tory backbencher tells me the Tory whips have actually encouraged this group to call for renegotiation of the UK terms of EU membership.

What’s the most important geo-political event of this century? Most people would say 9/11. The Foreign Secretary believes that it is the Arab Spring. But in The Times today (£), Emma Duncan makes a persuasive case for it being the collapse of Lehman Brothers. Duncan argues that Lehman Brothers’ fall has three claims to be an epoch-making event. The first is its contribution to the financial crisis and subsequent economic stagnation. The second is the way that it has catalysed China’s economic rise vis-à-vis the US, with China now predicted to become the world’s largest economy within this decade.

The word flying around Westminster this evening is that the government is going to announce a fresh package to stimulate growth tomorrow. In line with recent reports, the expectation is that new enterprise zones will be unveiled. Enterprise zones are, of course, the linchpin of the chancellor’s current strategy, offering generous tax breaks for start-up industries, relaxed planning regulations and investment in state-of-the-art broadband, so this would not be a novel move. But an announcement would be timely nonetheless.

If there's one sentiment that defines George Osborne's article for the Telegraph today, it’s that there is no need for us Brits to panic. The economic convulsions of the past few days, contends the Chancellor, serve to prove that the coalition was right to approach deficit reduction as it has. "The alternative of more spending and yet more borrowing is now frankly ludicrous," he says, "and places those who advocate it on the outer fringes of the international debate." He has a point. As I blogged on Saturday, there are reasons to believe that we'd be hurtling towards a credit downgrade and higher borrowing costs were it not for the fact that our debt-GDP ratio is set to decline by 2015.

Sir George Young has graced the pages of the Daily Mail this morning, arguing that MPs cannot ignore the clamour for a debate on the death penalty, as examined in depth by Pete last weekend. The Leader of the House’s intervention is the greatest indication yet that parliament will discuss the issue for the first time since the passage of the Human Rights Act in 1998. This has not come as a bolt from the blue. A string of e-petitions will mature soon and capital punishment is expected to be near the top of the list, as it always is when the public is asked for its opinion.