As previously covered, Irish Revenue announced on 4 May 2016 that the MFN clause in its tax treaty with Estonia was triggered effective 1 January 2016 by the 2014 protocol to the Estonia-Switzerland tax treaty, resulting in a 0% withholding tax rate for royalties. While similar announcements have not been made by Estonia's other tax treaty partners, for the treaties that have relevant MFN clauses, the 0% royalty rate also applies. In addition to Ireland, the affected treaties and date of effect are as follows:
In addition to the effect of the Estonia-Switzerland protocol on royalty withholding rates, the protocol also reduced the withholding rate on interest to 0%, which triggers the relevant MFN clauses of Estonia's treaties with France, Spain and the United Kingdom. The effects are as follows:
The interest withholding tax changes apply for the respective treaties from the same dates as the 0% rate for royalties listed above.
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