OREANDA-NEWS  The Russian government has decided to terminate the tax agreement with the Netherlands. The decree on this was signed by Prime Minister Mikhail Mishustin.

In August last year, the Russian side proposed to the Netherlands to raise the tax rate on dividends to a maximum of 15 percent. The country did not agree to this proposal, so the agreement was terminated. Head offices of several Russian companies are registered in the Netherlands, including X5 Retail Group and Yandex.

Malta, Cyprus and Luxembourg agreed to revise tax agreements earlier. Russian President Vladimir Putin in the spring of 2020, during one of his appeals to the nation, proposed taxing 15 percent on dividend income transferred to accounts abroad. The head of state then warned that this would require adjusting the agreements.

At the moment, Russia has agreements on the avoidance of double taxation with most countries in the world. According to Putin's proposal, all of them should be revised, since they have similar conditions of cooperation. According to them, most of the income from dividends and interest is taxed at the place of registration of the company, and the Russian budget receives payments at reduced rates.

The Russian authorities paid priority attention to the countries most often used by Russian businesses to withdraw capital: Cyprus, Malta and Luxembourg. The terms of agreements with them are reviewed first.