OREANDA-NEWS. The Russian Federation intends to denounce a convention with the Republic of Malta on the avoidance of double taxation and on the prevention of tax evasion in respect of income taxes. A notification on the start of the development of the relevant bill is published on the Russian portal of draft regulatory legal acts.

The current convention provides for the possibility of reducing taxes at the source (in Russia) when paying from Russia to Malta on dividends, interest and royalties up to 5 %. After the termination of the agreement, all such payments to the residents of Malta from Russia will be taxed in accordance with the Russian Tax Code, that is, at the rates of 15 % (for dividends) and 20 % (for interest and royalties).

The agreement is expected to expire in December 2020. The Russian side needs to submit a notice of termination of the treaty before June 30 to withdraw from it on January 1, 2021.