Capital discount: Amsterdam has announced a condition for the tax treaty with the Russian Federation / Comment / Izvestia.Ru
The Netherlands has announced a key condition for the Double Taxation Avoidance Agreement (DTAA) with the Russian Federation. This follows from the response of the Ministry of Finance of the Netherlands to a request from Izvestia newspaper. Amsterdam is ready to sign a treaty with Moscow if it includes benefits for real private Dutch businesses investing in Russia. The Russian Federation had previously offered the Netherlands a new DTAA under a standard model, similar to the agreements already concluded with Cyprus, Malta and Luxembourg. The document did not provide for benefits for private business – the only exceptions were public companies. The Netherlands rejected this offer. Then the Ministry of Finance of the Russian Federation threatened the Netherlands with a complete rupture of tax agreements. Experts believe that Moscow can meet Amsterdam halfway without creating a loophole allowing Russian businesses to withdraw capital.
Andrei Gusev, the Managing Partner at Borenius Russia, commented to Izvestia on what conditions are in the current agreement with the Netherlands.