ISLAMABAD: Switzerland has failed to honour its pledge of ratifying a revised Agreement on Avoidance of Double Taxation with Pakistan since July 2017.
Both countries reached an agreement in end-March last year and reached a consensus to approve it before July 2017, which would provide both countries a way of sharing information to unearth tax evaders, reported Dawn.
When the signing was concluded last year, Pakistan and Switzerland had already approved the agreement and forwarded it via the foreign office to the Swiss authorities last year, said a source in FBR.
He shared various reminders had been forwarded to Pakistani High Commission to talk about this problem with appropriate authorities.
On the other hand, a senior tax official said one article of this revised agreement which is linked to information exchange had already come into effect from January 1st this year.
The official shared the stipulation for this article wasn’t ratification but only signing of agreement.
The new revised agreement has significant improvements linked to taxation of service fees and capital gains accrued from sale of qualifying participants.
The government upon go-ahead from cabinet in August 2013 had asked Switzerland to include this updated version of the Article on Exchange of Information rooted on the OECD model.
Upon approval from the federal cabinet in August 2013, Pakistan had approached Switzerland for incorporating the updated version of the Article on Exchange of Information based on the OECD Model.
As per revised agreement, the rules enable economic exchange in bilateral relations and it also has an adjudication clause, which would safeguard avoidance of double taxation.
