BRUSSELS, Dec 12 (Reuters) - Liechtenstein would agree to searches of bank accounts and seizures under a draft agreement with the European Union to tackle financial and tax fraud, a document showed on Friday.

The draft agreement was negotiated by the European Commission but Germany sent back an earlier version as it wanted stronger commitments from the tiny non-EU Alpine state, where a number of Germans had salted away money to evade the taxman.

It will need unanimous approval from EU states and Liechtenstein to take effect.

"The agreement is innovative insofar as Liechtenstein up to now denied any assistance for fraudulent activities affecting direct taxation and as the agreement is the first one negotiated on a European level to cover all forms of taxes," a copy of the draft deal obtained by Reuters said. (Reporting by Huw Jones, editing by Dale Hudson)

Proposal for a Council Decisionon the conclusion, onbehalf of the European Community, of the Cooperation Agreement between the European Community and its Member States, of the one part, and the Principality of Liechtenstein, of the other part, to combat fraud and any other illegal activity to the detriment of their financial interests