The IBFD has received the text of the income and capital tax treaty between Switzerland and Argentina, signed on 23 April 1997. The treaty will soon be submitted to the Swiss parliament for approval. The treaty was concluded in the French, Spanish and English languages; the English text prevails in the case of divergence. The treaty generally follows the OECD Model Convention.
The maximum rates of withholding tax are:
- 15% on dividends generally, and 10% if the recipient is a company holding directly at least 25% of the capital in the dividend-paying company; and
- 12% on interest.
According to the protocol (para. 5), Art. 12(2)(withholding tax on royalties) does not apply as long as Switzerland does not, according to its domestic law, levy a withholding tax on royalties paid to nonresidents, and royalties will be taxable only in the state of residence of the beneficial owner of the royalties.
