The Swiss Federal Council has adopted dispatches on a new double tax agreement (DTA) with Liechtenstein and a protocol to the agreement with Norway.
The DTA with Liechtenstein was signed on July 10, 2015. It replaces the existing 1995 treaty. The agreement provides that old age and survivors’ insurance (AHV) pensions can be taxed solely in the state of residence. It eliminates the current double taxation of AHV pensions from Liechtenstein for people who live in Switzerland. In the case of cross-border commuters, the respective state of residence will continue to retain the right of taxation.
The DTA now covers the taxation of dividends, interest, and royalty payments. The Federal Council said that the DTA contains solutions for this income that are comparable to those recently concluded by Switzerland in other agreements.
The protocol to the DTA with Norway was signed on September 4. It implements the most favored nation clause and inserts a new arbitration clause. It also amends the article on the exchange of information, at Norway’s request.
The Federal Council said that the cantons and business associations have welcomed the agreements. The dispatches must now be approved by Parliament.
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