Nestle India Unaffected by Switzerland's MFN Suspension: A Policy Issue Overview

Nestle India states the suspension of the MFN clause by Switzerland will not impact the company. This matter, arising from a policy issue between India and Switzerland under the DTAA, affects companies with operations in Switzerland. Nestle already deducts a 10% withholding tax on cross-country transactions.

Nestle India announced on Thursday that the suspension of Switzerland's MFN clause will not impact the company, despite the broader policy issues it represents between governments. The FMCG major clarified the matter is not specific to them.

The suspension stems from a Supreme Court ruling stating the MFN clause under the DTAA cannot be enforced without being notified under Section 90 of the Income Tax Act. This policy change involves increased tax liabilities for Indian firms operating in Switzerland.

Nestle India, owning popular brands like Maggi and Nescafe, has been deducting a 10% withholding tax on cross-border payments, ensuring minimal disruption. While investments continue to rise in the Indian market, Nestle's firm foothold in India remains unshaken.

(With inputs from agencies.)