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Liechtenstein Consults On Changes To Tax Assistance Acts

by Ulrika Lomas, Lowtax.net, Brussels
13 December, 2013

The Liechtenstein Government has submitted a bill for consultation, amending the Principality's tax administrative assistance act, as well as the bilateral tax administrative assistance act with the US.

According to the Liechtenstein Government, the consultation bill implements necessary changes to the mutual tax assistance process. In accordance with the recommendations of the Global Forum on Transparency and Exchange of Information for Tax Purposes, the draft legislation provides for deferred notification of persons who are the subject of an administrative assistance request, albeit in certain exceptional circumstances.

In such cases, affected taxpayers will only be notified after information has been disclosed to the requesting state's authorities, for example when there is the risk that prior notification of the individual concerned would compromise the success or outcome of the investigation.

The Global Forum recommended in its Peer Review report from September 2011, and in its supplementary report from October 2012, that Liechtenstein include in its administrative assistance legislation provisions allowing the deferred notification of affected persons.

Liechtenstein aims to comply with the Global Forum's suggestion, ahead of the Phase 2 Peer Review process, due to take place in the second half of 2014. This is to avoid incurring an unfavorable Peer Review rating. The Principality's tax administrative assistance acts will therefore be modified accordingly.

The Global Forum is charged with in-depth monitoring and peer review of the implementation of the standards of transparency and exchange of information (EoI) for tax purposes. The peer review is undertaken in two phases. While Phase 1 reviews assess the quality of a jurisdiction's legal and regulatory framework for EoI, Phase 2 reviews look at the practical implementation of that framework.

The consultation period ends on January 31, 2014. The consultation report is available on the Government's website.

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