News: Russia adopted the rules of the OECD Convention on tax agreements

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Russian President Vladimir Putin signed the federal law on May,1, which subject is “About the ratification of the multilateral Convention on the implementation of measures relating to tax agreements in order to counter the erosion of the tax base and the withdrawal of profits from taxation”. After its adoption by the State Duma and approval by the Council of the Federation, the new measures are aimed at creating conditions from attempts to distort the tax base and transactions with high risks in order to avoid additional taxation

Under federal law, an important international standard is implemented. She suggests that a business can avoid double taxation when paying income from a resident of one country to a resident of another. Also, some types of transactions that are provided for under contracts between the Russian Federation and other countries will be removed from the additional tax and financial burden.

Experts note that the ratification of the Russian Federation of this convention will allow more actively, and most importantly - in a legitimate way to realize the right to avoid additional tax burden. However, experts note that the Convention will help the tax authorities of the Russian Federation not only to counteract tax abuse. It will also allow for the distribution of natural and artificial load on goods, services and obligations only if the other party to the contract (that is, the representative of another resident country) provides this opportunity, based on the laws of the countries, contract terms and so on.

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