Russia is threatening to terminate the tax treaty with the Netherlands out of dissatisfaction with the mild tax climate for companies in the Netherlands. Many Russian multinationals have settled in the Netherlands and therefore pay much less tax than in Russia.
The Russian Ministry of Finance has made a proposal and sent it to the State Duma, the parliament. If it accepts it, and according to correspondent David Jan Godfroid there is no reason to assume that it does not, it will have major consequences for Russian companies in the Netherlands.
The Russians are particularly dissatisfied with the low dividend tax in the Netherlands. They have proposed that the Netherlands raise it to 15 percent for large Russian companies, but talks about this have failed.
Also approached Cyprus, Malta and Luxembourg
The Netherlands is not the only country that the Russian authorities have targeted. In August it was announced that Cyprus, Malta and Luxembourg had also been approached. It is unclear whether those countries have fulfilled Russian wishes.
They are not the smallest Russian companies that have established themselves in the Netherlands for tax reasons. Internet giant Yandex and the X5 Retail Group, owner of various supermarket chains, have their tax headquarters here.
The Russian authorities are in urgent need of money and have started a campaign against capital flight. Due to corona, there is much less demand for oil and that is an important pillar of the Russian economy.
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