International Tax Review is part of the Delinian Group, Delinian Limited, 8 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2023

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Switzerland: Spontaneous exchange of tax rulings

schreiber.jpg

parmentier.jpg

René Schreiber


Veronique Parmentier

Could multinationals, in the future, see their Swiss tax rulings sent to foreign jurisdictions by the Swiss authorities? In 2013 Switzerland signed the Convention on Multilateral Administrative Assistance in Tax Matters (the Convention), which provides for spontaneous exchange of information. In January 2015 the Swiss Federal Council initiated a decree allowing ratification of the Convention and the amendment of the Swiss law on administrative assistance to introduce spontaneous exchange of information into domestic law. A draft decree was submitted to the parliament in June 2015 and first exchanges of information are expected as from January 1 2018. The question remains as to whether these exchanges will also include Swiss advanced tax rulings.

Article 7, paragraph 1 of the Convention lists the cases in which a jurisdiction should spontaneously transmit information to another jurisdiction. The OECD Manual on the implementation of exchange of information for tax purposes provides additional guidance regarding such circumstances. However, none of these documents refer explicitly to tax rulings.

The Swiss Federal Council will issue a decree providing more details regarding the obligations resulting from the Convention, and the tax authorities will issue some practical directives that will take into account the practice in other jurisdictions as well as international standards. Based on the current parliamentary work, this includes the framework being developed by the Forum on Harmful Tax Practices under the BEPS umbrella for the spontaneous exchange of tax rulings.

Therefore, it has to be expected that any tax ruling relating to a cross-border transaction involving movable income, which benefits from a preferential regime and a low effective rate of taxation, would fall under the scope of the new spontaneous exchange of information. It is, at this stage, less clear for other tax rulings. Many current tax rulings including the taxation of mixed companies, holding companies or principal structures will most likely fall into the first category.

René Schreiber (rschreiber@deloitte.ch) and Veronique Parmentier (vparmentier@deloitte.ch)

Deloitte

Tel: +41 58 279 7216 and +41 58 279 7856

Website: www.deloitte.ch

more across site & bottom lb ros

More from across our site

A steady stream of countries has announced steps towards implementing pillar two, but Korea has got there first. Ralph Cunningham finds out what tax executives should do next.
The BEPS Monitoring Group has found a rare point of agreement with business bodies advocating an EU-wide one-stop-shop for compliance under BEFIT.
Former PwC partner Peter-John Collins has been banned from serving as a tax agent in Australia, while Brazil reports its best-ever year of tax collection on record.
Industry groups are concerned about the shift away from the ALP towards formulary apportionment as part of a common consolidated corporate tax base across the EU.
The former tax official in Italy will take up her post in April.
With marked economic disruption matched by a frenetic rate of regulatory upheaval, ITR partnered with Asia’s leading legal minds to navigate the continent’s growing complexity.
Lawmakers seem more reticent than ever to make ambitious tax proposals since the disastrous ‘mini-budget’ last September, but the country needs serious change.
The panel, the only one dedicated to tax at the World Economic Forum, comprised government ministers and other officials.
Colombian Finance Minister José Antonio Ocampo announced preparations for a Latin American tax summit, while the potentially ‘dangerous’ Inflation Reduction Act has come under fire.
The OECD’s two-pillar solution may increase global tax revenue gains by more than $200 billion a year, but pillar one is the key to such gains due to its fundamental changes to taxing rights.