Yesterday
in Budapest, Switzerland and Hungary signed a new double taxation
agreement (DTA) in the area of taxes on income and assets. It
replaces the agreement of 9 April 1981. The new DTA contains
provisions on the exchange of information in accordance with the
international standard applicable at present. It will contribute to
the further positive development of bilateral economic relations.
Aside
from an OECD administrative assistance clause, Switzerland and
Hungary have agreed that both countries may levy withholding tax of
no more than 15% on gross dividend amounts. If, however, a company
holds a stake of at least 10% in the capital of the distributing
company, the dividends will be exempt from withholding tax. Moreover,
there will be no withholding taxes on dividends paid to the national
banks of the two countries or to pension funds. In addition, interest
and royalty payments will be taxable only in the state of residence.
Finally, gains realised on the sale of shares in real estate
companies can now be taxed in the country where the real estate is
located.
After
negotiations finished, a report on the new DTA with Hungary was
submitted to the cantons and the business associations concerned for
their comments. They approved the signing. The new agreement still
has to be approved by parliament in both countries before it can come
into force.
No comments:
Post a Comment