The agreement should replace the DTA currently in force with Pakistan. It contains improvements with regard to the taxation of service fees and capital gains resulting from the sale of qualifying participations. These rules promote economic exchange in bilateral relations. The agreement also contains an arbitration clause, which should guarantee the avoidance of double taxation.

The agreement contains a provision on the exchange of information in accordance with the international standard and an anti-abuse provision in accordance with the minimum standard set by the BEPS project of the G20/OECD.

The cantons and business associations concerned welcomed the conclusion of the DTA with Pakistan. In order to enter into force, the DTA has to be approved by Parliament in Switzerland and the necessary approval procedure has to be carried out in Pakistan.

So far, Switzerland has signed 55 DTAs that are in line with the international standard on the exchange of information; 50 of these are in force.

Switzerland and Pakistan sign double taxation agreement