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The prospects for international taxation in terms of court cases on application of double taxation treaties were discussed at the first virtual meeting of BRICS Young Tax Professionals Working Group (BRICS YTP WG). The meeting organized within the Russian Chairmanship in BRICS was attended by the tax administrations’ officials from the member countries. More than 500 listeners joined the live broadcast.

This meeting was moderated by Prof. Victor Machekhin, Kutafin Moscow State Law University and the Finance University.

As he stated, “The purpose of such an event is not only to exchange experience in the application of legal norms, but also to gain an understanding of how tax legislation in other jurisdictions works and what other countries do in the field of double taxation agreements.”

Ekaterina Mikhailu, Head of International Projects Division at the International Cooperation and Capital Movement Control Directorate of the Federal Tax Service of Russia, emphasized in her introductory speech that participation in this working group provides young tax specialists with a unique opportunity to share their experiences, expertise, and perspectives on the most significant tax issues in their respective countries.

Mikhail Volkov, Head of Expert Analysis Division at the International Taxation Directorate of the Federal Tax Service of Russia, used specific examples of Russian court decisions to explain to his BRICS colleagues the specifics of applying national tax legislation and the provisions of international tax treaties to payments of income in the form of interest and royalties. He defined the approaches of tax authorities to applying the concept of beneficial ownership of income to interest, as well as procedural issues of administering the application of benefits under the international treaties.

The representatives of the South African Revenue Service gave a speech on cases affecting on the most-favored-nation treatment for interest in the international transactions and clarified the application of transfer pricing rules. Colleagues from the Islamic Republic of Iran shared their experience in applying double taxation treaties to royalty income. The discussion of the presented cases was held as open debates, joined by representatives of the tax administrations from Russia, India, China, South Africa, Iran and the UAE.

Following the meeting, the participants expressed interest in further developing cooperation in the exchange of experience among BRICS young tax professionals. The next meeting of BRICS YTP WG is scheduled for December 2024.