Schumi with a little tax problem - 6th June 18:07pm GMT

It has long been a haven for the super-rich, but moves are underway to end Switzerland's status as one of the favourite refuges of tax exiles from all over Europe and beyond.

The "Schumi Initiative" - a petition to parliament named after German Formula One racing driving Michael Schumacher, who is currently building a lavish mansion on the shores of Lake Geneva - seeks to put an end to local deals that allow some 3,000 wealthy expats living in Switzerland to negotiate low rates of tax.

Schumacher, who has an estimated fortune of £500 million, is believed to pay less than 10 per cent of his earnings in tax.

He is officially listed as "unemployed" in his adopted homeland, where he moved to from Germany in 1996 to escape crippling income taxes of 42 per cent, coupled with 53 per cent on investments and an extra 5 per cent on his total tax bill to fund the rebuilding of East Germany.

Suzanne Oberholzer, an MP for the Social Democrats, is behind the petition to parliament and has already gained support among other politicians. She said: "We expect a decision in the autumn. It cannot be right for Michael Schumacher and some 3,000 other foreign, rich inhabitants of Switzerland to be free from normal income tax rules.

"It is unfair to the Swiss people and to the people of neighbouring lands who must shoulder their fair share of financial obligations.

"The ability to negotiate these customised deals should go. He should pay his fair share like everyone else."

If the law is successful, Schumacher could end up paying more than 40 per cent tax in total: almost as much as if he moved back across the border to Germany.

One German newspaper yesterday claimed that Schumacher, who earns in the region of £50 million a year, pays £2 million in tax, which would be just 4 per cent of his earnings.

When he moved in 1996, Schumacher told finance magazine Cash: "Switzerland let it be known to me that I could negotiate a sensible tax settlement with them.

"In Germany they are stupid to themselves if they cannot make me an offer and then lose all my tax money."

The Green Party in Switzerland is backing the move to claw back millions in tax from people like Schumacher.

The Social Democrats and Greens make up about 40 per cent of the Swiss parliament.

Cecile Buhlmann, a Green Party MP, said: "I find it utterly scandalous that people like Michael Schumacher pay a fraction of what they should. It shames the little people of this country."

The current maximum federal tax rate in Switzerland is 11.5 per cent with individual cantons having their own tax rate on top, giving them room for significant flexibility to attract high earners to the area with the offer of low tax rates.