The treaty aims to eliminate double taxation on cross-border transactions and strengthen cooperation on tax transparency and compliance.
Liechtenstein’s parliament approved the ratification of its income and capital tax treaty with Latvia on 7 November 2025.
Signed on 2 October 2025, the treaty aims to eliminate double taxation on cross-border transactions and strengthen cooperation on tax transparency and compliance. It also provides for the exchange of tax information in accordance with international standards, including automatic exchange mechanisms under Liechtenstein’s agreement with the EU.
The agreement applies to Latvia’s enterprise income tax, personal income tax, and immovable property tax, as well as Liechtenstein’s personal and corporate income taxes, real estate capital gains tax, and wealth tax.
Key provisions include the elimination of withholding tax on dividends, interest, and royalties paid between legal entities of the two countries. In other cases, the treaty limits withholding tax rates to 10% for dividends and interest, and 5% for royalties.
The treaty will take effect 15 days after both countries exchange their ratification instruments and will be applicable from 1 January of the calendar year following its entry into force.
Earlier, Latvia and Liechtenstein signed an income and capital tax treaty on the sidelines of the seventh summit of the European Political Community in Copenhagen on 2 October 2025.
