Tax Treaty update

With draft law N° 6826 (the “June Draft Law”), which was submitted to Parliament on June 9th 2015, Luxembourg aims at expanding further its already comprehensive double tax convention network. The Draft Law, if adopted, would ratify and add or replace another four new double tax treaties concluded with Andorra, Croatia, Estonia and Singapore, and six new protocols amending existing tax treaties with France, Ireland, Lithuania, Mauritius, the United Arab Emirates and Tunisia. All these new treaties and amending protocols follow the OECD Model Tax Convention.

"Luxembourg currently has an impressive network of 76 tax conventions in force and 29 treaties under negotiation."

As regards the six protocols, Luxembourg shows an ongoing commitment to include exchange of information provisions in line with the OECD standards in the tax treaties. That’s why five out of the six new protocols deal mainly with an exchange of information provision. The protocol amending the tax treaty with France mainly targets capital gains realised upon the sale of shares or other rights in real estate companies, which shall be taxed in the country where the real estate is located.