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Cablegate: Taxation of Un Mission Residences

VZCZCXYZ0000
RR RUEHWEB

DE RUEHGV #2131 2440508
ZNR UUUUU ZZH
R 010508Z SEP 06
FM USMISSION GENEVA
TO RUEHC/SECSTATE WASHDC 0878
INFO RUEHSW/AMEMBASSY BERN 7192

UNCLAS GENEVA 002131

SIPDIS

SIPDIS

DEPT PASS TO L/DL - SUSAN BENDA AND DS/OFM/TPB - RICHARD
MASSEY; BERN FOR STEPHEN DODSON

E.O. 12958: N/A
TAGS: AMGT KLIG SW
SUBJECT: TAXATION OF UN MISSION RESIDENCES

REF: STATE 133522 (NOTAL)

1. Summary. Reftel requested information about Swiss
taxation of foreign-owned diplomatic mission residences, and
asked post to describe any USG or post-owned properties used
as residences by US Mission personnel. Mission can confirm
that there are no/no USG-owned properties used as residences
by U.S. Mission Geneva personnel, including chiefs of
mission. In a call to Embassy Bern, Mission learned that USG
owns the chancery complex of approximately four buildings,
including TDY apartments, and the Ambassador's residence, but
owns no properties used as residences by other U.S. Embassy
personnel. Swiss MFA lawyer Danielle Werthmueller confirmed
that Switzerland grants tax exempt status to real property
owned by foreign governments and used for the premises of the
mission and the residence of the chief of mission, but does
not/not exempt government-owned real property used as
residences for other diplomatic personnel. GOS extends the
same real property tax treatment to bilateral missions and
missions to the UN and other international organizations.
End summary.

2. Per reftel, Mission Legal Adviser met with Swiss MFA
lawyer Danielle Werthmueller, who handles privileges and
immunities issues for the Swiss Mission to the UN in Geneva.
Werthmueller explained that Switzerland does not/not exempt
from taxes foreign government-owned real property used as
residences by diplomatic staff below the level of chief of
mission. Only foreign government-owned mission or chancery
premises and the residences of the chiefs of mission are
granted real property tax exemptions. According to
Werthmueller, this practice applies uniformly to foreign
government-owned properties used by bilateral diplomatic
representatives and by representatives to UN and other
international organizations in Switzerland.

3. According to Werthmueller, Swiss practice on real
property tax exemptions has been consistent since the late
1940s, and reflects its obligations under international law.
In a Decree of the Federal Council dated March 31, 1948,
permanent missions in Geneva were given a status analogous to
that granted to diplomatic missions established in Bern, and
this was continued in amendments dated May 20, 1958 and
November 3, 1967. Since Swiss accession to the 1961 Vienna
Convention on Diplomatic Relations, codified at RS 0.191.01
of the Swiss Federal Code, the Convention has been the
international legal basis for this tax exemption.
Application of the Convention provisions to permanent
missions in Geneva is reflected in the 1967 amendment to the
Federal Council Decree.

4. Mission Legal Adviser queried Werthmueller on the reasons
behind the 1948 Federal Council Decree, but she was unable to
shed any light on the question. She did provide a booklet
prepared by Amadeo Perez, the Legal Adviser to the Swiss
Mission, which contains some historical background. Mission
will scan and email booklet to L/DL - Susan Benda. Swiss
federal laws are available at www.admin.ch in French, German,
and Italian. Mission will email relevant provisions to L/DL.

5. In response to query about USG-owned property, post
confirms that USG owns mission complex, but does not/not own
any residential properties, including for chiefs of mission.
Per L/DL telephone request Mission called Embassy Bern and
learned that USG owns the chancery complex of approximately
four buildings, including TDY apartments, and the residence
of the Ambassador but does not own any other staff
residences.
CHAMMAS

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