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Liechtenstein Eyes Changes To New Tax Law

by Ulrika Lomas, Tax-News.com, Brussels

20 September 2012


The Liechtenstein government has during a recent sitting adopted a consultation report pertaining to a revision of the Principality’s tax law.

According to the Liechtenstein government, the consultation draft provides for measures aimed at increasing tax revenues in Liechtenstein.

In the area of wealth and individual income tax, it is proposed in the report that the lower and middle tariffs be adjusted in such a way as to ensure that the tax burden is the same as under the country’s old tax law. In addition, the introduction of an additional 8% tax rate has been advocated.

As regards corporate income tax, it is proposed in the report that there is a decoupling of the notional interest deduction and the own capital interest deduction. It is also advocated that no loss carry forwards are generated by own capital interest deductions, and that the loss carry forward allocation is limited to a maximum 70% of net profit.

Furthermore, it is suggested in the report that the minimum income tax and therefore also the minimum capital levy be increased to CHF1,800 (USD1,950), as under the old tax law. The government notes that it had already proposed this figure when the new tax law was being drafted.

Concluding its release, the government explains that application of the new tax law has revealed the need to simplify and clarify individual provisions. The current consultation draft contains such proposals to modify the legislation, the government ends.

TAGS: individuals | tax | interest | law | corporation tax | Liechtenstein | offshore | legislation | tax rates | tax breaks | individual income tax

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