Russian President Vladimir Putin on May 26 signed a law denouncing the treaty for the avoidance of double taxation between Russia and the Netherlands that was signed in Moscow in 1996 and entered into force in 1998.
Under the existing treaty, either country may terminate the agreement by giving notice to the other country at least six months in advance of the end of the year. The termination then becomes effective at the beginning of the next calendar year.
Thus, assuming Russia gives notice by June 30, the termination will be effective January 1, 2022.
Russia had been seeking to update to the treaty to increase the withholding rates on dividends and interest to 15%, but negotiations with the Netherlands failed to produce agreement.
Russia recently successfully negotiated updates to its treaties with the Cyprus and Malta governments to increase the withholding tax on interest and dividend payments to 15 percent.
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