The Ministry of Finance invited a number of Gulf countries to reconsider tax agreements

The Ministry of Finance proposed to a number of Gulf countries to begin negotiations on adjusting double taxation agreements. Deputy head of the department Alexey Sazanov announced this at a meeting with business, his quotes press service of the ministry.

It is not specified which specific countries we are talking about. According to Mr. Sazanov, the purpose of the proposal is to prevent businesses from using foreign jurisdictions only to apply lower tax rates or to evade taxes. He argues that the agreements should encourage foreign investment.

“The standard model of the 10–10–10 agreement is taken as the basis, with exceptions for government agencies, sovereign funds and state-owned companies (that is, the withholding tax rate on dividends, interest and royalties is a flat rate of 10%),” the deputy minister added.

The Ministry of Finance began reviewing double taxation agreements with friendly countries in 2022. The tax on dividends can be reduced to 5-10% (depending on the country) instead of the 15% rate, and on interest on loans and royalties – to 0% instead of 20%.

January 25 Forbes reportedthat the UAE has asked Russia to reconsider tax agreements with Arab countries. According to the publication, the UAE authorities want the same conditions that Russia has with other Middle Eastern states – Qatar and Saudi Arabia. the next day Alexey Sazanov confirmedthat the Ministry of Finance proposed to Saudi Arabia and Qatar to reconsider agreements on the avoidance of double taxation.

About the peculiarities of the work of companies in the UAE – in the publication “Kommersant FM” “Russian business has started speaking Arabic”.

Laura Keffer