The Diplomat
Yesterday the Council of Ministers approved the agreements between Spain and Ukraine on Double Taxation in relation to income taxes and on Cooperation and Mutual Assistance in Customs Matters.
On the one hand, the Government ordered the referral to the Parliament of the Agreement with Ukraine for the elimination of Double Taxation in relation to Income Taxes and for the prevention of Tax Avoidance and Evasion, and at the same time authorized the expression of Spain’s consent to be bound by the said agreement.
As the Government recalled, the relations between Spain and Ukraine in the field of international taxation have been mainly developed, since the independence of that country, under the protection of the Agreement between Spain and the Union of Soviet Socialist Republics (USSR) to avoid double taxation on income and wealth, signed on March 1, 1985.
Formal negotiation of a new convention began in the past decade and concluded in December 2017, when the text was adopted. “This new convention responds to the desire of both countries to pursue the development of their economic relations and to strengthen their cooperation in tax matters, without creating opportunities for non-taxation or reduced taxation through evasion or avoidance”, explained the Council of Ministers. The signing of this Double Taxation Agreement between Spain and Ukraine was authorized by the Council of Ministers on June 29, 2018 and was signed on September 10, 2020 in Madrid by the Minister of Foreign Affairs, Arancha González Laya, and the Ukrainian Minister of Foreign Affairs, Dmytro Kuleba.
On the other hand, the Council of Ministers yesterday authorized the manifestation of Spain’s consent to be bound by the Agreement between Spain and Ukraine on Cooperation and Mutual Assistance in Customs Matters. It also ordered its subsequent referral to the Spanish Parliament for merely informative purposes, since the Council of State determined last November that this agreement does not require the authorization of the Parliament.
According to the Government, the Ukrainian customs authority proposed in 2011 to the State Agency of Tax Administration the conclusion of a bilateral agreement on customs cooperation and assistance. Accepting the initiative in consideration of bilateral trade between the two countries, the Agency’s Customs and Excise Department developed in the following years with its Ukrainian counterpart the negotiation, which was substantially concluded in 2015. The 2014 European Association Agreement with Ukraine, in force since 2017, allows for the signing of bilateral agreements of this type.
This new agreement, which will help strengthen relations between the customs administrations of the two countries and will incorporate matters not included in the European text – such as cooperation in the fight against the smuggling of drugs and other illicit goods and the carrying out of controlled deliveries – was also signed last September 10 in Madrid by González Laya and Kuleba, following authorization by the Council of Ministers on June 29, 2020.
