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Residents of Malta and Luxembourg will remain without tax incentives

Residents of Malta and Luxembourg will remain without tax incentives

Malta and Luxembourg met the Russian government and agreed to revise the treaty on the avoidance of double taxation. The deputy head of the Ministry of Finance Alexei Sazanov told the journalists about this.

Negotiations with the aforementioned jurisdictions are planned to be completed upon negotiations with Cyprus.

Both countries agree with the conditions of Russia to increase the tax rate, so there is no need to denounce the agreements, Sazanov said.

Among other things, Russia will again send a proposal to the Government of Cyprus to raise the rate to 15% for the payment of dividends to foreign companies. The talks are scheduled for August 10-11.

For the first time, President Vladimir Putin announced the need to raise taxes in mid-April. At the moment, according to the agreements between Russia and Malta, the preferential tax rate on dividend payments is 5% if the Maltese company owns 25% of the Russian company, and its share in the authorized capital is at least €100,000. In other cases, the rate is 10% of the total amount. In Luxembourg companies can count on benefits if they own at least 10% of the capital of the paying companies, and also if they invest at least €80,000 in it. In other cases, the rate is 15%.

Cyprus was the first country to which the government sent a proposal to revise the agreements. The conditions of Russia in this case were quite tough, since the authorities proposed to abolish the benefits altogether. As a result, Russia made a decision to denounce the agreement unilaterally.

It also became known this week that the government has sent a proposal to revise the agreements to the Dutch Ministry of Finance. So far, the dividend rate for residents of the country is 5%, and the interest rate is zero.


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