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Austria To Agree Swiss-Style Tax Deal With Liechtenstein

Tuesday, January 15, 2013

During an upcoming working visit to Vienna, Liechtenstein’s Prime Minister Klaus Tschütscher is due to hold talks with key ministers from the Austrian chancellery and from the finance ministry, with the discussions focusing on the "imminent conclusion" of a bilateral tax agreement between the two countries.

The bilateral tax accord between Austria and Liechtenstein, aimed at resolving the issue of Austrian citizens’ undeclared and untaxed bank accounts in the Principality, is reportedly based on a deal similar to that concluded between Austria and Switzerland, which entered into force at the beginning of the year.

The Swiss-Austrian tax deal provides for a withholding tax to be levied on undisclosed assets held by Austrian residents in Swiss banks to regularize the accounts and imposes an annual withholding tax on future investment income.

Unlike the treaty brokered with Switzerland, the accord being negotiated with Liechtenstein is expected to encompass undeclared assets held in both foundations and trusts in Liechtenstein.

Tschütscher is due to meet with Austrian Chancellor Werner Faymann, with Austrian Vice Chancellor Michael Spindelegger, as well as with Austria’s Finance Minister Maria Fekter and Economy Minister Reinhold Mitterlehner.

An agreement on a treaty is expected by the end of January.