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Swiss federal council adopts dispatches on new DTAs


Added on 14/11/2014

The Swiss Federal Council has adopted dispatches on five double taxation agreements, which will now be submitted to Parliament for approval, reports Tax News.

The treaties with Estonia, Ghana, Iceland, and Uzbekistan either replace or revise the current deals, while the agreement with Cyprus is Switzerland's first with the territory. All of the DTAs contain administrative assistance provisions in accordance with the international standard for the exchange of tax information.

The amended DTA with Estonia places a maximum withholding tax rate on dividend income at source of ten percent. The agreement with Iceland will establish a withholding tax exemption if the recipient holds at least ten percent of the capital of the dividend paying company, and also provides for exemptions for pension funds and national banks. Under the deal, royalty income will be subject to tax of no more than five percent in the source state.

Last month, the Federal Council launched a consultation on legislation for the unilateral application of the Organisation for Economic Cooperation and Development's (OECD's) new Standard on the Exchange of Information to all Swiss DTAs that are not already in line with this model.