Suspension of certain provisions of tax treaties with 38 countries

The Decree "On Suspension of Certain Provisions of International Treaties on Taxation by the Russian Federation" was signed by the Russian president and came into force on August, 8. Certain provisions of double taxation agreements with 38 countries (EU member states and the US) were suspended.

The freeze applies to:

• payments of dividends,
• interest on debt obligations,
• royalties or other passive income,
• articles related to tax exemptions on income from rental and sale of real estate, and sale of shares in companies.

Despite the suspension of most provisions, some of them will continue to be in effect:

• mutual agreement procedure (interstate mediation in resolving disputes);
• information exchange.

The Decree instructs Russian Government:

• to take measures to reduce the impact on Russian economy of listed tax treaties suspension consequences;
• to submit a bill on the suspension of the treaties to the State Duma.

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