As noted, negotiations were held to amend the agreement in terms of increasing the withholding tax to 15% in relation to dividends and interest.
After analyzing the proposals of colleagues, the Russian Ministry of Finance came to the conclusion that “in fact, they erode and make unattainable the effect assumed by the Russian side of the measures taken to support the national economy and social programs, and will also facilitate tax-free withdrawal from the territory of Russia through the Cypriot jurisdiction of significant financial resources of Russian origin ”.
At the same time, as indicated in the message, Moscow formulated compromise options and offered to promptly hold a face-to-face meeting, but was refused.
In March, Russian President Vladimir Putin said that all payments of income in the form of interest and dividends going abroad to offshore jurisdictions should be taxed adequately - at least 15%. The head of state instructed to adjust the agreements with some countries.
According to various estimates, more than 1.4 trillion rubles were withdrawn to Cyprus in 2018, and more than 1.9 trillion in 2019.