Cabinet approved Moldovan-French convention on avoidance of double taxation

Chisinau, 3 November /MOLDPRES/ - The cabinet of ministers today approved a draft decision for approving the signing of the Convention between the governments of Moldova and France on the avoidance of double taxation and prevention of fiscal evasion as to the income tax.   

According to the government’s communication and protocol department, the Convention’s goal is to develop the economic relations between Moldova and France both in the field of removing the double taxation of private people and legal entities, as well as in the attraction of foreign investments.     

At the same time, the draft regards the creation of fiscal systems, which would coordinate the actions of the contracting states aimed at avoiding the double taxation, eliminating the fiscal discrimination in any form, as well as at ensuring the exchange of information, which will give friendly conditions for the carrying out of external economic activity and will strengthen the bilateral relations.  

The process of negotiations of a new Convention was held in July 2020 and February 2021.

After the talks, the sides agreed on the shares of the tax on dividends, interests and royalty, as follows:

· Dividends - 5% and 10%;

· Interests - 5% with two exceptions;

· Royalty – 6% in gross sum.

The institution in charge of the negotiation, signing, interpretation and implementing the concerned Convention is the Finance Ministry.

The present convention will enter into force on the first day after the date when the last notification on the fulfillment of the internal procedures, needed for the Convention’s entrance into force, was received.  

According to the Article 14 of the Law No 595/1999 on the international treaties, the Convention is to be ratified by Moldova’s parliament.

Moldova presently enforces Agreements and Conventions on the avoidance of double taxation with 50 states.

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