Appenzell Outer Rhodes last week cancelled an exhibition in Cologne promoting the canton's tax saving qualities to German firms, while some banks have reportedly banned foreign travel for executives.

Switzerland's tradition of banking secrecy has come under fire in the last year as a succession of countries accuse it of helping their citizens evade taxes.

The United States authorities are still pursuing an investigation against Switzerland's largest bank, UBS, for allegedly helping tax dodgers, while the world's 20 most influential countries meet this week to decide on whether to blacklist the Swiss as a tax haven.

Germany has been particularly vocal in its criticism of the Swiss banking regime, with Finance Minister Peer Steinbrück repeatedly using provocative language in the ongoing row.

Appenzell Outer Rhodes, that offers low rates of corporate tax to entice foreign to relocate, said last week its planned exhibition in Cologne would only "pour oil onto the flames".

"Business as usual"

Cantonal spokesman Georg Amstutz told the Tages-Anzeiger newspaper: "Because the financial debate is currently dominated by the topic tax evasion, it is not appropriate for us to communicate our message."

Not all cantons are adopting the same approach however, and the association of cantonal finance directors told swissinfo that it has issued no specific guidelines on foreign promotional activities.

The Greater Zurich Area organisation, that promotes trade for the canton of Zurich and neighbouring areas such as Schaffhausen and Zug, said it was business as usual despite the row.

"We have not changed our activities in Germany as we do not run any specific promotional events in that country," chief executive Willi Meier told swissinfo.

"Tax is an important element in attracting companies, but we have never used it at the forefront of our campaigns."

"We assume that once the discussions currently taking place between Switzerland and Germany are concluded then things will return back to normal again," he added.

Bankers "stay at home"

Some Swiss private banks have reportedly stopped executives from travelling abroad for fear of them being hounded by the authorities of other countries. The US authorities detained two UBS executives in recent months during their tax investigation.

Unnamed sources told the Financial Times newspaper last week that some senior executives were afraid of leaving Geneva, home to many Swiss private banks.

"If today I go to Germany to visit two banks I deal with...German customs can take me in and question me," one senior industry figure told the FT.

However, the Swiss Bankers Association (SBA) said there was no blanket ban on travel and that it had made no specific recommendations to its members.

"It may be individual banks. They are free to do whatever they want," said SBA President Pierre Mirabaud. "I travel all the time even in America. I have no fear of travelling."

Switzerland has signalled its intent to make concessions to other countries by renegotiating tax treaties in an effort to stave off a sustained international attack.

But it has also reacted fiercely to some comments, particularly from Steinbrück who earlier this month likened the Swiss to "Indians" running scared from the US "cavalry". The German ambassador to Bern was summoned by the Swiss foreign ministry for a dressing down after this remark.

swissinfo, Matthew Allen in Zurich