The US urges the EU to reduce taxes on income from Russia's frozen assets
Kyiv • UNN
The US is calling on the EU to lower taxes on income from frozen Russian assets to maximize the funds that can be lent to Ukraine, potentially up to $50 billion this summer, by issuing bonds or loans to be repaid with interest from those assets.
The US authorities have called on European regulators to reduce taxes on income from frozen Russian assets. This was reported by the Financial Times newspaper with reference to Deputy Assistant to the President of the United States for National Security Affairs Dalip Singh, who deals with global economic issues, UNN reports.
Details
The U.S. has proposed to reduce taxes on income from frozen Russian assets as part of a proposal to finance Ukraine by borrowing against future profits from these assets.
This plan could be implemented through the issuance of bonds for the private sector or loans from G7 governments, which would be repaid primarily through interest income from frozen assets. According to this plan, Ukraine could receive $50 billion this summer.
Dalip Singh said that it is very important to "maximize the annualized interest income" from the frozen Russian assets. Creditors will need assurances that they will receive repayment, which can be achieved by setting aside a certain share of interest reserves. The change in the tax regime could increase the annual interest income from frozen assets to €5 billion.
Not only where the assets are invested matters, but also the level of taxation. We must maximize the use of every euro of these immobilized reserves for the benefit of Ukraine
According to him, the G7 countries plan to transfer funds from blocked assets to Ukraine this summer.
Abolishing the taxes would require "significant legal changes to the corporate tax system in Belgium," said one panelist. He also added that a change in the tax regime is unlikely.
AddendumAddendum
The bulk of the Russian central bank's assets - approximately €190 billion - are held in Euroclear.
