ISLAMABAD, Oct 15: Pakistan and Switzerland, on Tuesday inked a convention for the avoidance of double taxation between the two countries. The two sides exchanged the document initiated by Vakil Ahmed Khan, Member Direct Taxes, CBR and Eric Hess, Deputy Head of the Division for International Fiscal Law and Double Taxation matters Federal Tax Administration of Switzerland.
The Convention is initiated after extensive deliberation of tax experts of both the countries.This will be an important step towards strengthening bilateral economic relations and promotion of investment.
It would be recalled that Convention was originally signed between Governments of Pakistan and Switzerland in the late 50s and made operative in October 1960.
It was subsequently modified in respect of some of the provisions through a supplementary protocol in 1964. The convention essentially emphasises the concepts of taxation on income of international business transactions in the home country of the recipient.
Re-negotiations of operative tax agreements is not an unusual phenomenon. It is part of the process of updating existing agreements in view of fast changing business environment all over the world.
That is why many operative tax treaties have already been revised and the process is going on.