Russia Turns Sights To Switzerland, Hong Kong Treaties

by Ulrika Lomas, Tax-News.com, Brussels

18 August 2020

Russia's double tax agreements with Hong Kong and Switzerland are next on the radar for authorities in Russia, who are seeking to ensure the country can subject to at least 15 percent withholding tax outbound dividends and interest payments.

In televised comments during a meeting with Russian Prime Minister Vladimir Putin, Deputy Prime Minister Alexei Overchuk said authorities are reviewing Russia's network of double tax agreements to identify those that do not permit taxation at source at at least a 15 percent rate.

Already, the Russian Government has negotiated to increase withholding tax rates in the agreement with Cyprus, having earlier threatened to withdraw from the deal. After reaching that compromise, Russian Deputy Finance Minister Alexey Sazanov said: "In the coming month, we also plan to complete negotiations with Luxembourg and Malta on the same terms as we offered Cyprus."

The Russian Ministry of Finance further stated: "Russia is also awaiting an official response from the Netherlands to directed proposals to revise the tax agreement in the coming weeks. If the Netherlands agrees to negotiate, they will be offered the same conditions as the Republic of Cyprus."

In his televised comments, Overchuk said the Russian Government has yet to receive a response from the Dutch Government but would follow up with it if necessary.

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