Protocol of amendment to double taxation agreement with Latvia enters into force

Bern, 02.10.2018 - The protocol to amend the double taxation agreement (DTA) between Switzerland and Latvia with respect to taxes on income and capital entered into force on 3 September 2018. It will take effect from 1 January 2019. The agreement has been supplemented by the provision on the exchange of tax-related information upon request and has been adapted in several other respects.

In particular, the protocol implements certain developments from the OECD's "Base erosion and profit shifting" (BEPS) project. Specifically, it introduces an abuse clause that focuses on the main purpose of an arrangement or a transaction. The basic features of this clause correspond to the abuse clauses that Switzerland has agreed in most of its DTAs in recent years.

Furthermore, the current residual tax of 5% on dividends paid to companies that have stakes of at least 10% will be abolished. The current 10% residual tax on royalties will be reduced to 5%. The royalties paid by companies to other companies will now be taxed only in the beneficial owner's state of domicile.

Finally, the agreement will be supplemented by an arbitration clause that will ensure greater legal certainty for taxpayers.

Address for enquiries

Bilateral Tax Issues and Double Taxation Treaties Section, State Secretariat for International Finance SIF
Tel. +41 58 462 71 29,


Federal Department of Finance