MOSCOW, August 5 (RAPSI) - The Russian Finance Ministry intends to exclude Malta from the list of offshore zones due to the double taxation and prevention of tax evasion convention having been ratified between the governments of Russia and Malta, RIA Novosti reports. Respective changes to the list of offshore zones were published on the official legal website.

On April 2, the Russian President signed a bill on the ratification of a convention with Malta to prevent double taxation and tax evasion.

The provisions of the conventions are the same as for most similar documents, which are that a company affiliate’s profits are subject to taxation in the country of location.

According to the convention, the tax on the dividends paid from Russia in Malta’s favor, is 5% if the recipient is a Maltese company that directly owns at least 25% of a Russian company’s assets and the share is at least 100,000 euros. In all other cases, the tax is 10%. Interest and royalties are also subject to a 5% tax provided that they are close to market rates. Any profit from property sales is subject to taxes in the country where the property is located.

In late 2013, President Putin announced de-offshorization of the Russian economy and gave instructions to the government to draft changes to the law on the taxation of Russian companies in offshore jurisdictions. Specifically, the companies registered in offshore areas, will not be able to apply for government aid.