Switzerland and the Netherlands Sign New Double Taxation Agreement

The Federal Department of Finance in Switzerland informs that today in The Hague, Switzerland and the Netherlands signed a new double taxation agreement (DTA) in the area of income tax. It will replace the existing DTA of 1951/1966. The new agreement contains namely provisions on the exchange of information in accordance with the OECD standard, which were negotiated in line with the key points decided by the Federal Council. The new DTA will contribute to the further positive development of bilateral economic relations.

Compared with the current DTA, improvements have been achieved in the area of withholding taxes: the percentage holding for withholding tax exemption for dividends has been reduced from 25% at present to 10%. Dividend payments to pension funds will also be exempt from tax in the source state in future. Furthermore, a zero rate has been agreed for interest. In addition, the new DTA contains an arbitration clause. This is used if the competent authorities are unable to reach an agreement within three years following the commencement of a mutual agreement procedure.

After negotiations finished, a report on the new DTA with the Netherlands was submitted to the cantons and the business associations concerned for their comments. The Conference of Cantonal Finance Directors and the business associations largely welcome the signing of the agreement.

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Press Release from the Federal Department of Finance in Switzerland
Original Release can be found at: http://www.efd.admin.ch/00468/index.html?msg-id=32020&lang=en
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