§ 13 Tax Act (StG) - Tax Allocation

1. The allocation of tax liability among cantons is governed by the principles of federal law prohibiting inter-cantonal double taxation, and with respect to foreign countries, by the international agreements for the avoidance of double taxation.

2. Foreign losses are only to be considered for rate determination purposes. This is subject to Paragraph 3, § 14 Paragraph 2, and the provisions contained in double taxation agreements.

3. If a Swiss company offsets losses from a foreign permanent establishment against domestic profits, and within the following seven years earns profits from this establishment, a revision of the original assessment must be made to the extent of the profits that are eligible for offsetting in the permanent establishment's state. In such cases, the losses from this establishment will only be considered for rate determination purposes in Switzerland retroactively.

4. Permanent establishments abroad are only recognized if the ordinary taxes are paid there.

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