12 Apr Rubik Tax Agreement Switzerland
The protocols for amending the agreements between the European Community and the Swiss Confederation and the Principality of Liechtenstein.dem on the Council`s Directive 2003/48/EC on the taxation of savings income in the form of interest payments apply to Austria from 1 January 2017. They provide for an automatic exchange of information between the contracting parties in accordance with the OECD Common Reporting Standard (SIR). Clearly, this meant thinking about the future of the two Rubik`s agreements. The agreements use the “Rubik” model to deal with unreported billions of foreign customers in Swiss banks. Brussels has already questioned the validity of the agreement and France has made it clear that it is not interested. She wants to be able to find and punish fraudsters. For her part, Swiss Finance Minister Eveline Widmer-Schlumpf said she was ready to discuss “specific technical issues” but not to change the substance of the agreement. “If Brussels ever agrees on the direction this should take, the EU will ask Switzerland to review existing agreements and accept automatic exchanges. Bern will refuse. There will be new negotiations, and one day an agreement will be reached.
It is by no means certain that the two tax treaties will also overcome the obstacles of the Swiss parliament. Tax expert Paolo Bernasconi says he expects Germany to ask for changes on some points that are not fully compatible with the EU, but are not all lost. “The chord is designed like the rubik cube with different blocks. When you remove a block, it doesn`t collapse. Derobert believes that the situation will remain the same if the agreements are abolished as they are today. Switzerland has also entered into a withholding agreement with Austria, which is terminated with the switch to the automatic standard for information exchange with the EU. The two countries signed an agreement to this effect on 11 November 2016. Only Italy made positive noises, Prime Minister Mario Monti said that an agreement with Switzerland was “a way to verify”. The German finance ministry has said it is not fully renegotiating its agreement, but would consider changes here and there. Double taxation refers to the fact that two countries tax taxes on the same item.
This can happen when companies or individuals reside in different countries or when they receive income from another country. The agreements reduce double taxation and thus help to overcome obstacles to cross-border economic transactions. In addition, they govern mutual tax assistance. “And if it works with Germany, I imagine a lot of other countries might be interested in a similar agreement,” he said. Bern, 14.11.2016 – The withholding agreement between Switzerland and the United Kingdom is terminated on 1 January 2017.