“The denunciation by Russia of the double taxation agreement with Cyprus is aimed exclusively at protecting the national interests of our country in the field of budgeting,” said Sergei Zheleznyak, a member of the State Duma Committee on International Affairs, commenting on the statement of the RF Ministry of Finance.
According to the politician: “Russia has offered foreign partners a fairer taxation scheme, which allows receiving additional revenues to the country’s budget and does not harm business. At the same time, it is clear that offshore companies, accustomed to ultra-high incomes, may be unhappy with such a decision. Obviously, the Russian leadership proceeds primarily from state interests and proposes new forms and methods of replenishing the budget to fulfill social obligations to citizens and for economic development.
If other countries with low tax jurisdictions refuse the proposed agreement, Russia will also denounce the treaties with unfair tax redistribution. The revision of tax agreements creates preconditions for the transfer of businesses by Russians from abroad to domestic jurisdictions, for example, to special administrative regions with a reduced tax rate. “