Double taxation agreements (DTAs) avoid earnings and assets being taxed in two countries. They can be particularly helpful in ensuring that the Swiss economy does not suffer any disadvantage compared to foreign competitors. Switzerland has concluded agreements with all the important industrialised countries to avoid double taxation. The agreements govern international tax situations such as exemption of profits from production plants in the partner state, reclamation of withholding tax and taxation of licence fees.
In its campaign against “tax havens”, the G20 organisation included Switzerland on its “grey list” on 2nd April 2009. Several countries had already criticised and threatened Switzerland in connection with information exchange surrounding tax issues. As early as 13th March 2009, the Federal Council decided to adopt the OECD standard for international administrative assistance in tax matters in accordance with article 26 of the OECD Model Tax Convention. Thus, Switzerland committed itself to providing information to other countries in individual cases on the basis of specific and justified requests. The Federal Council then began negotiations for the revision of double taxation agreements, in particular with OECD members. On 25th September 2009, Switzerland signed a DTA with Qatar. Within six months – between March and September 2009 – Switzerland signed twelve DTAs including extended administrative assistance in accordance with the OECD criteria. As a consequence, Switzerland was removed from the “grey list”.
According to the Federal Constitution, double taxation agreements are not subject to an optional referendum if they do not include important additional obligations compared to previous contracts. The Federal Council said that after a possible referendum on the DTAs signed between March and September 2009, this regulation will apply again to subsequent agreements.
The website of the ‹Swiss Federal Tax Administration› provides an overview of all the DTAs concluded by Switzerland along with other up-to-date information.