Glossar

The indicator is defined (in the Maastricht Treaty) as total gross debt at nominal value at the end of the year after consolidation of intra-governmental liabilities: Currency and deposits (AF.2), debt securities (AF.3), and loans (AF.4). According to the definition, the balance sheet item “other liabilities” is not included. The government sector includes the central government, the states, municipalities and social security funds. The data are recorded in the national currency and converted at the end of the year using the Euro exchange rate of the European Central Bank.

Transfer expenditure refers to expenses made without receipt of a direct consideration in return. Governmental transfer expenditure may include, for example, subsidies, development assistance, financial compensation between the government and the municipalities, etc.

Transfer income refers to income received without having to render direct compensation in return. C.f. Transfer expenditure.

The value added tax is a consumption tax. The taxes are applied to the difference be-tween the seller-purchased price and the resale price. This is accomplished by taking full tax on all sales, but refunding the tax difference to the sellers. The value added tax has to be paid on sales of goods and services and on imports of goods. On the basis of a States treaty, Liechtenstein has adopted the Swiss law on value added tax. Liechtenstein and Switzerland form a common value added tax area. Since 1st January 2010, the value added tax rates are 2.5% for certain goods as water, food, agricultural products, drugs, and books, 3.8% for hotel services, and 8.0% for all other goods and services.

Natural persons have to pay wealth tax and personal income tax on their entire wealth and their entire personal income, if their residence or habitual abode is in Liechtenstein (unrestricted tax liability). Natural persons not residing in Liechtenstein have to pay wealth tax and personal income tax on their domestic wealth in Liechtenstein and their domestic personal income generated in Liechtenstein (restricted tax liability). In the case of unrestricted tax liability, the object of the wealth tax is the entire movable and immovable wealth of the taxpayer, after deduction of debts. The object of the personal income tax is all income in money and money's worth. Investment income is not part of the personal income, because investments are liable to the wealth tax.

Persons who receive income from employed work in Liechtenstein or payments as members of the board of directors and who live abroad have to pay a withholding tax, which is deducted at source. In the case of income from employed work, the tax rate varies with the height of the income, and in the case of payments to members of the board of directors, the tax rate is 12%. Double taxation agreements can contain different provisions for withholding taxes.