German Finance Minister Peer Steinbrueck and his Slovenian counterpart Andrej Bajuk signed a bilateral agreement to avoid double taxation
German Finance Minister Peer Steinbrueck and his Slovenian counterpart Andrej Bajuk signed on Wednesday, 3 May a bilateral agreement to avoid double taxation.
In a statement for the press in Ljubljana, Bajuk said that the agreement, which replaces the 1988 agreement between West Germany and the former Yugoslavia, enables not only avoidance of double taxation, but also free flow of capital and labour.
"The agreement has been upgraded in line with the convention of the Organisation for Economic Cooperation and Development (OECD), and other similar agreements which Slovenia has already signed with several EU member states," Bajuk also said.
Steinbrueck is convinced that the agreement will make it easier for Slovenian companies to do business in Germany and vice versa, as well as strengthen bilateral economic cooperation.
According to Bajuk, all European finance ministers are aware of the concerns about competition between countries in the field of taxation, therefore this should be subject to discussions within the EU.
"If we wish to create an economy which would be up to the challenges of today, if we wish to achieve the development of other countries around the world, we have to tackle the problem of taxation. I believe simplification is a step in the right direction," Bajuk explained.
The two ministers also talked about current economic issues, structural reforms, and Germany's and Slovenia's preparations for their respective stints at the helm of the EU (in the first half of 2007 and the first half of 2008).
"Europe should enter the global market in a more unified and competitive way, which could solve the problem of different taxation, avoid bureaucracy, and implement the principle of subsidiarity," Steinbrueck said.
The German finance minister moreover praised Slovenia's progress regarding the euro changeover, adding that the European Central Bank and the European Commission are to publish their reports in the next few months.
Slovenia exported EUR 2.8bn of goods to Germany last year, which is 20% of Slovenia's entire export. Meanwhile, Slovenia imported from Germany EUR 3.1bn of goods, which also stands for 20% of Slovenia's import.
According to the data of the Bank of Slovenia, direct investment of German companies in Slovenia stood at EUR 406.2m on 31 December 2004, which represents around 7% of all foreign investment in Slovenia in 2004.
Germany is thus the fifth largest investor in Slovenia after Austria, Switzerland, Netherlands and France, with investment from Bavaria representing a third of all German investment in Slovenia.
As the Economics Ministry told STA, Slovenia is interested in development-oriented investments in domestic economy. All German investments in Slovenia have proved successful, however, there have been no new investments in recent years, the ministry added.
Source: Slovene Press Agency STA