Cyprus Removed From Russia’s Black List of Offshore Havens

New decree of Russia’s Ministry of Finance (MinFin) that removes Cyprus from a so-called ‘black list’ of offshore tax havens came into effect on January 1, 2013.

The Ministry of Justice registered a related order of MinFin #115n from August 21, 2012 on introducing changes to the list of states and territories that provide preferential tax treatment and/or do not stipulate disclosing and providing information about financial operations (offshore tax havens) on October 25, 2012.

According to Russia’s tax legislation, transactions conducted between Russian companies and organizations located in offshore zones from MinFin’s list are subject to stricter tax regulations. Among other things, preferential zero tax rate for profit tax does not apply to dividends received by Russian companies from organizations located in these offshore tax havens.