NEW DELHI: Nestle India assured stakeholders that Switzerland’s suspension of the MFN (Most Favoured Nation) clause under the Double Taxation Avoidance Agreement (DTAA) will have no impact on its operations. The FMCG major, known for iconic brands like Maggi, Nescafe, and KitKat, clarified that the policy change, stemming from a Supreme Court ruling, is a broader issue between India and Switzerland and not specific to the company.
Nestle India said it has consistently adhered to a 10 per cent withholding tax on cross-country payments, rendering the policy shift inconsequential to its business.
Tax liabilities to rise
The suspension follows a December 11 announcement by the Swiss government, reacting to a Supreme Court judgment that overturned a Delhi High Court ruling from 2021, which upheld MFN tax benefits under DTAA. The change has raised tax liabilities for other Indian firms with Swiss operations.
“The matter is a government-to-government policy issue and not Nestle-specific. We confirm that Nestle India’s adherence to the 10 per cent withholding tax remains unchanged,” a Nestle India spokesperson said. India, a key market for Swiss parent Nestle SA for over 112 years, continues to receive significant investments from the FMCG giant. Between 2020 and 2025, Nestle India has committed Rs6,000-6,500 crore towards expanding manufacturing and infrastructure, including its tenth factory in Odisha. For FY23-24, the company reported Rs24,393.9 crore in revenue.
