CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Liechtenstein Lawmakers Give Go-Ahead To Austrian Tax Accords

Liechtenstein Lawmakers Give Go-Ahead To Austrian Tax Accords

by Ulrika Lomas, Tax-News.com, Brussels

11 September 2013


During a recent sitting, the Liechtenstein parliament gave the green light to the withholding tax agreement with Austria, together with the protocol revising the existing double taxation agreement (DTA) between the two countries in the area of taxes on income and on wealth.

The withholding tax law provides for the specific withholding tax rates to be applied to legalize the untaxed wealth of Austrians with assets held in the Principality, and provides a comprehensive framework for tax cooperation.

Under the terms of the withholding tax treaty, future capital gains realized by Austrian citizens with assets deposited in Liechtenstein will be taxed at a rate of 25 percent. Previously untaxed assets will be subject to a one-off withholding tax payment to draw a line under the past, with rates generally varying between 15 percent and 30 percent of the asset value, although rising to 38 percent in the case of particularly large wealth.

In contrast to Austria's tax agreement with Switzerland, foundations in Liechtenstein will also be subject to taxation under the terms of the deal, not just the capital assets of Austrians located in Liechtenstein banks.

Welcoming the decision by Liechtenstein lawmakers to adopt the agreement package, Austrian Finance Minister Maria Fekter stressed that this "is another major step in the direction of greater tax equity."

Fekter said: "Tax flight is becoming increasingly unattractive, as this agreement significantly reduces incentives. Implementation of the agreement, which was signed at the end of January in Vaduz, finally makes the days when Austrian money could be funnelled past the Austrian tax authorities and parked in Liechtenstein a thing of the past."

Highlighting the fact that one-off payments from Liechtenstein are expected to arrive in Austria in the second half of 2014, Finance Minister Fekter pointed out that Austria has already received two tranches totaling EUR671.4m (USD890.9m) so far this year from the tax deal concluded with Switzerland.

Concluding, the Austrian Finance Minister stressed that the withholding tax agreement with Liechtenstein is "a good solution for the past and future," making clear that the treaty is a major achievement for the Government. Furthermore, the accord will generate additional revenue for the state budget, thereby strengthening Austria and enabling the Government to continue along its fiscal consolidation path towards a zero deficit, Fekter ended.

The agreement package is due to enter into force at the beginning of 2014.

TAGS: Finance | tax | double tax agreement (DTA) | law | budget | Liechtenstein | agreements | tax rates | withholding tax | Austria | Switzerland | Tax

To see today's news, click here.

 















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »