Argentina terminates tax treaty with Switzerland

The Argentine Government has formally notified the Swiss authorities that it has terminated the provisional application of the double tax treaty signed by both countries in 1997

The notification was sent on January 16, 2012 but was not published in the Official Gazette until January 31, 2012.

The treaty’s revocation may significantly impact multinationals that relied on its favorable provisions, particularly with respect to taxation of royalty payments.

Under certain circumstances, withholding tax on royalties paid to Swiss residents was subject to zero percent withholding tax. Upon the treaty’s termination, however, withholding tax on royalty payments to Swiss residents may be subject to rates as high as 31,5%.