OREANDA-NEWSThe Federation Council at a meeting on Monday ratified the protocol to the Russian-Austrian convention on the avoidance of double taxation with respect to taxes on income and capital.

The need to adjust the convention is caused by the changed conditions of economic activity, changes in the legislation of the Russian Federation and Austria, the development of bilateral economic relations and international tax trends, including those related to the exchange of information.

For organizations involved in bilateral Russian-Austrian investment relations, the rate of dividend tax at the source is set at 5%, provided that at least 10% of the capital of the company paying the dividends is owned. This will allow to apply such a rate not only for large, but also medium and small companies. The protocol also allows taxing at the source of income payments on mutual fund shares, including real estate funds.

At the initiative of the Russian Federation, the convention is supplemented by provisions that allow taxing income from the alienation of shares of companies or similar rights in a company, more than 50% of the value of which is represented by real estate in that state (Russia or Austria) where it is located. As previously reported, State Duma deputies ratified the protocol to the convention on the avoidance of double taxation with respect to income and capital, subjects of economic relations.

The need for this amendment is due to the growth of economic ties between Russia and Australia and the increase in trade and other financial relations. These amendments should stimulate bilateral relations, help improve the business climate between the two countries and increase investment in the economies of the countries.