During a virtual signing ceremony that took place on July 12, 2023, the Liechtenstein Prime Minister and Finance Minister Daniel Risch and the Italian Minister of Economy and Finance Giancarlo Giorgetti signed the double taxation agreement (DTA) between Liechtenstein and Italy. Although the DTA has been signed, the DTA does not yet enter into force. For the DTA to enter into force, the respective ratification procedures have to have been finalized in both jurisdictions.

The DTA arranges the elimination of double taxation in cross-border situations, which is based on the international standard of the OECD and takes into account the results of the OECD/G20 BEPS project (Base Erosion and Profit Shifting).

The agreement establishes rules governing the avoidance of double taxation and tax evasion with respect to taxes on income. According to a press release issued by the Liechtenstein Government a zero rate for withholding taxes is provided for group dividends. As part of the provisions on the mutual agreement procedure between the two countries, an arbitration clause and an additional protocol on arbitration were also agreed. The Liechtenstein Government further states that the regulation on the exchange of information corresponds to the international standard and includes administrative assistance for enforcement, whereby the automatic exchange of information will continue to be processed via the Automatic Exchange Of Information agreement that Liechtenstein has concluded with the EU.

Unfortunately the text of the Liechtenstein-Italian DTA is not yet available.

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