(Unofficial translation)

 

Decree of the President of the Republic of Belarus

No 6 of May 7, 2012

[Amended as of September 4, 2017]

On Stimulating Entrepreneurial Activity in the Territory of Middle, Small Urban Settlements, Rural Area

With a view to stimulating entrepreneurial activity in the territory of middle, small urban settlements and rural area and in accordance with part three of Article 101 of the Constitution of the Republic of Belarus:

1. To establish that:

1.1. commercial organizations of the Republic of Belarus (with the exception of commercial organizations created after August 1, 2016  as a result of an reorganization in the form of  splitting-up, splitting-off, merging and also of commercial organization reorganized after the said date by means of their affiliating other legal persons of the Republic of Belarus), individual entrepreneurs registered in the Republic of Belarus with the place of location (residence) in the territory of middle, small urban settlements and rural area* (hereinafter, unless otherwise provided by this Decree – commercial organizations and individual entrepreneurs) and carrying out activity on productions of goods (execution of works, rendering of services) in the territory of middle, small urban settlements and rural area, within seven calendar years from the day of their state registration:

are entitled not to calculate and pay the tax on profit (commercial organizations) and income tax for natural persons (individual entrepreneurs) in relation to, respectively, profit and income, received from realization of goods (works, services) of own production**;

are exempted from payment of state duty for issue of special permits (licenses) for carrying out of certain kinds of activity by legal and natural persons (including the one connected to specific goods (works, services), introduction into such a special permit (license) of changes and/or additions, prolongation its validity period;

are entitled not to calculate and pay  other taxes (duties) (with the exception of the value added tax, including the value added tax collected when goods are being imported to the territory of the Republic of Belarus, excises, stamp and off-shore dues, state duty, patent duty, disposal due, customs duties and dues, land tax, ecological tax, tax for extraction (removal) of natural resources and other taxes calculated, deducted and/or remitted when duties of a tax agent are performed, unless otherwise provided by this Decree);

are exempted from compulsory sale of foreign currency received on transactions with legal persons non-residents and natural persons non-residents from realization of goods (works, services) of own production, and also from giving the property into lease.

Concerning commercial organizations arisen as a result of an reorganization of the legal person in the form of transformation, specified in indent one of part one of this sub-clause, seven calendar years shall be computed from the date of state registration of the legal person as a result of transformation of which the respective commercial organization has been created;

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* For the purposes of this Decree, the territory of middle, small urban settlement and rural area is deemed to be the territory of the Republic of Belarus with the exception of the territory of cities of Baranovichi, Borisov, Brest, Vitebsk, Gomel, Grodno, Zhodino, Lida, Minsk, Mogilev, Mozyr, Molodechno, Novopolotsk, Orsha, Pinsk, Polotsk, Rechitsa, Slutsk, Soligorsk.

** For the purposes of this Decree the realization of goods (works, services) of own production concerning the commercial organizations and individual entrepreneurs means the realization of goods (works, services) of own production within the validity period of the certificate of own production (certificate of works and services of own production), issued under the procedure established by the legislation to commercial organizations and individual entrepreneurs carrying out their realization.

1.2. commercial organizations of the Republic of Belarus, within seven calendar years from the day when the decision about creation of a separate division* has been taken under the established procedure:

1.2.1. are entitled not to calculate and pay:

tax on profit in relation to the profit received by the separate division from realization of goods (works, services) of own production**;

tax on immovable property from the value of capital constructions (building, structures), parts thereof, car parking spaces, being on the balance sheet of the separate division and located in the territory of middle, small urban settlements and rural area;

1.2.2. are exempted from compulsory sale of foreign currency received on transactions with legal persons non-residents and natural persons non-residents from realization of goods (works, services) of own production, produced by the separate division;

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* For the purposes of this Decree, separate division means affiliates and/or other separate divisions of a commercial organization of the Republic of Belarus, carrying out activity on production of goods (execution of works, rendering of services) in the territory of middle, small urban settlements and rural area, having a separate balance sheet, for which a bank account has been opened and officials of those separate divisions have been given powers to dispose of monetary funds on the account, fulfilling tax obligations of the said commercial organization and created in the territory of middle, small urban settlements and rural area outside a settlement the territory of which is or was the place of location of the that commercial organization or the place of location of an organization which as a result of reorganization in the form of affiliation was affiliated to the said commercial organization, or the place of location of an organization as a result of reorganization of which in the form of transformation, splitting-up, splitting-off, merging the said commercial organization arose (was created).

** For the purposes of this Decree, the realization of goods (works, services) of own production concerning the separate division means the realization of goods (works, services) of own production within the validity period of the certificate of own production (certificate of works and services of own production), issued under the procedure established by the legislation and in which this separate division is indicated as separate divisions carrying out production of goods (execution of works, rendering of services).

1.3. commercial organizations and individual entrepreneurs, and also commercial organizations of the Republic of Belarus having separate divisions, in the part of activity of separate divisions:

1.3.1. are exempted from compulsory conclusion of transactions on exchange trading of the Open Joint-Stock Company "Belarusian Currency and Funds Exchange" when purchasing raw materials, components and materials for own production, and also when carrying out foreign trade with goods of own production (with the exception of acquisition, in full or in part, at the expense of budgetary means and/or means of state non-budgetary funds by recipients of such means), and also upon realization of goods of own production for export (with the exception of goods classified in heading 4403 of Single Commodity Nomenclature for Foreign Economic Activity of the Eurasian Economic Union;

1.3.2. are entitled to:

independently determine conditions, volumes, kinds of raw materials, components and materials, being purchased, and also conditions, volumes and kinds of realization of produced articles, goods (works, services) of own production;

independently determine suppliers (contractors or performers) or buyers of articles, goods (works, services) for own production and products, goods (works, services) of own production (with the determining suppliers (contractors or performers) upon acquisition of goods (works, services), in full or in part, at the expense of budgetary means and/or means of state non-budgetary funds by recipients of such means);

insure their property interests with insurance organizations, insurance brokers, created outside the Republic of Belarus;

1.4. dispositions contained in indents two and five of part one of sub-clause 1.1, indent two of sub-clause 1.2.1, sub-clause 1.2.2 of this clause do not cover the realization of goods (works, services) the production of which is carried out fully or partly with the use of fixed assets being in the ownership or in another real right of commercial organizations of the Republic of Belarus (including those registered in the territory of middle, small urban settlements and rural area) or individual entrepreneurs, which carry out their realization, or the use of labour of workers of these organizations or individual entrepreneurs outside the territory of middle, small urban settlements and rural area, unless otherwise established in sub-clause 1.5 of this clause.

The right provided in indent two of part one of sub-clause 1.1 and indent two of sub-clause 1.2.1 of this clause may be exercised by the commercial organization or individual entrepreneur, separate division provided that a separate accounting of proceeds (by commercial organizations or separate division) or incomes (by individual entrepreneur), received from the realization of goods (works, services) of own production which are covered by dispositions contained in indent two of part one of sub-clause 1.1 and indent two of sub-clause 1.2.1 of this clause, has been conducted, and also of  costs (by commercial organization or separate division) or expenses (by individual entrepreneur) on production and realization of these goods (works, services) expenses, and the certificate of own production (certificate of works and services of own production), issued under the procedure established by the legislation has been presented to the tax body. In that instance proceeds (income) from realization of goods of own production and costs (expenses) on production and realization thereof shall not include, accordingly, the value of property (including materials, spare parts) used for purposes of executing those works (rendering those services) presented for payment above the price of such works (services) and the costs (expenses) related to such property.

In the absence of the separate accounting provided in part two of this sub-clause or when the certificate of own production (certificate of works and services of own production) is not presented, the dispositions contained in indent two of part one of sub-clause 1.1 and indent two of sub-clause 1.2.1 of this clause are not applied.

Exemption from the tax on immovable property provided in indent four of part one of sub-clause 1.1 and indent three of sub-clause 1.2.1 of this clause:

is given in the quarter if in the immediately preceding quarter, the commercial organization, individual entrepreneur, separate division carried out realization of goods (works, services) of own production which in accordance with this Decree are covered by provisions of indent two of part one of sub-clause 1.1 and indent two of sub-clause 1.2.1 of this clause. In that instance giving property into lease (financial lease (leasing), another for-compensation and gratuitous use shall not be referred to such works (services);

is not applied in relation to:

commercial organizations, separate divisions and individual entrepreneurs carrying out activity indicated in indents six – thirteen of sub-clause 1.8 of this clause;

tax on immovable property from the value of capital constructions (building, structures), parts thereof, car parking spaces,  located outside the territory of middle, small urban settlements and rural area;

tax on immovable property from the value of buildings, structures, transfer devices of construction not finished within normative time limits;

tax on immovable property from the value of capital constructions (building, structures), parts thereof, included  the list of capital constructions (buildings, structures), parts thereof and land plots (parts of land plots) on which they are located, not used (used ineffectively), approved by regional councils of deputies or on their instructions by regional executive committees under the procedure and on the conditions established by the Council of Ministers of the Republic of Belarus. In that instance computation and payment of the tax on immovable property shall be effected in the period in which, in accordance with the legislation, an increased rate of the given tax shall be applied in relation to the mentioned capital constructions (building, structures), parts thereof;

1.5. commercial organizations, individual entrepreneurs, separate divisions, rendering services on carriage of cargo, passengers and luggage on automobile transport, have the right to apply dispositions provided in indents two and five of part one of sub-clause 1.1, indent two of sub-clause 1.2.1, sub-clause 1.2.2 of this clause, in relation to the realization of the said services when simultaneously the following conditions are met:

when rendering services on carriage of cargo, passengers and luggage on automobile transport, points of departure (loading) and/or of destination (unloading) are located in the territory of middle, small urban settlements and rural area;

automobile transport means used by commercial organizations, individual entrepreneurs, separate divisions for rendering services on carriage of cargo, passengers and luggage on automobile transport are registered, under the established procedure, by registering (registering and testing) divisions of the State Automobile Inspectorate of the Ministry of Internal Affairs in the territory of middle, small urban settlements and rural area;

1.6. the dispositions contained in indents two and four of part one of sub-clause 1.1, sub-clause 1.2.1 of this clause are not applied in relation to:

individual entrepreneurs in the part of activity on which the single tax from individual entrepreneurs and other natural persons is paid;

organizations being payers of the single tax for producers of agricultural produce (with the exception of organizations applying that tax exclusively in the part of affiliates and other separate divisions, fulfilling the tax obligations of the organization), and also in relation to affiliates and other separate divisions, fulfilling the tax obligations of the organization, in the part of their activity the organization applies the single tax for producers of agricultural produce;

organizations and individual entrepreneurs, applying the simplified taxation system;

organizations carrying out activity on rendering services in the sphere of agroecotourism and paying the due for carrying out activity on rendering services in the sphere of agroecotourism;

organizations applying other special taxation regimes established by the legislation;

1.7. dispositions contained in sub-clause 1.2 of this clause are not applied in relation to separate divisions, if the decision about creating of such divisions is taken after December 31, 2018;

1.8. dispositions contained in sub-clauses 1.1 – 1.3 of this clause do not cover:

banks, non-bank credit-and-finance organizations, investment funds, insurance organizations, micro financing organizations;

professional participants of securities market;

residents of the Park of High Technologies, the Special Tourist and Recreational Park “Avgustovski Canal”, the China-Belarus industrial park 'Great Stone';

commercial organizations, individual entrepreneurs, separate divisions, in the part of their carrying out of:

real estate activity;

activities in the field of gambling

lottery activity;

activity on organizing and holding electronic interactive games;

production and/or realization of excisable goods;

production and/or realization of jewellery and other household articles made of precious metal and precious stones;

production of securities, banknotes, coins, postage stamps;

activity within the framework of a simple partnership;

1.9. commercial organizations are granted exemption from import customs duties in relation to goods being imported (imported) to the territory of the Republic of Belarus, to be contributed to the statutory fund of those commercial organization upon its formation as a non-monetary contribution of the founders, manufactured not more than five years ago and classified according to the Single Commodity Nomenclature for Foreign Economic Activity of the Eurasian Economic Union in headings 7301, 7302, 7308, 7309 00, 7311 00, 8401–8408, 8410–8426, 8430–8481, 8483, 8484, 8486, 8487, 8501–8519, 8521–8523, 8525–8537, 8543, 8545, 8601–8609 00, 8707, 8709–8713, 8716, 8801 00–8805, 8901–8908 00 000 0, 9005–9008, 9010–9020 00 000 0, 9022–9032, 9103–9107 00 000 0, 9201, 9202, 9205–9208, 9401–9406, 9503 00–9508 (hereinafter – the goods).  The date of manufacture of goods shall be confirmed by the data indicated in the technical documentation or other documents referring to goods or contained on the good itself. In case of only information about the year of manufacture is available, the date of manufacture is deemed to be July 1 of the year of manufacture, if there is information about the month and he year of manufacture – the 15th day of the month of manufacture, if there are contradictory data or the information about the date of manufacture is absent, it shall be deemed that more than five years have passed from the date of manufacture.

The exemption in accordance with part one of this sub-clause is granted in the instance of importation to the territory of the Republic of Belarus of goods for:

formation of the statutory fund prior to its he state registration  – after the state registration of the commercial organization and reflection of contributing those goods to the statutory fund as a non-monetary contribution in the constituent documents;

formation of the statutory fund of the commercial organization after its state registration (with the exception of an organization the statutory fund of which, in accordance with the legislation or constituent documents must be formed prior to its state registration) – within the time limits established by the legislation or in accordance therewith in the constituent documents of the commercial organization for formation of such a fund.

In case of importation to the territory of the Republic of Belarus of goods classified according to the Single Commodity Nomenclature for Foreign Economic Activity of the Eurasian Economic Union in heading 8709, the exemption in accordance with part one of this sub-clause is granted subject to observance of requirements listed in part two of this sub-clause and subject to availability in the commercial organization (its creating) jobs in the number corresponding to the quantity of imported goods to be filled with workers have the qualification that meets requirements established by the legislation in the field of automobile transport.

In relation to goods imported with exemption from import tax duties in accordance with part one of this sub-clause, the duty on payment of import customs duties is to be fulfilled in the order established by the legislation if within five years from the day of placement of those goods under the customs procedure of release for internal consumption at least one action has been effected:

a decision abut liquidation of the commercial organization in the statutory fund of which have contributed the goods has been taken in the established order or a reorganization of the given commercial organization has been carried out in the form of splitting-up, merging, its accession to another legal person or a reorganization of the given commercial organization has been carried out in the form of  splitting-off as a result of which the given commercial organization loses the ownership, right of economic management or operative administration to the goods;

the commercial organization has changed the place of location to the territory of cities specified in the footnote to indent one of part one of sub-clause 1.1 of this clause;

withdrawal (expulsion) of a participant from the commercial organization has been effected as a result of which the given organization loses the ownership to the goods;

the commercial organization (owner of the property of the organizations) concluded transactions stipulating the transfer of ownership, right of economic management, right of operative administration to the goods, or the goods are transferred into temporary use;

the owner of property of the organization has seized goods from its economic management or operative administration.

Provision of part one of this sub-clause shall be applied in particular in the instance if prior to placement of goods under the customs procedure of release for internal consumption, the given goods had been placed under customs procedures of customs warehouse, temporary importation (acceptance) or place for temporary storage.

Requirements established in part four of this clause shall be applied particularly in relation to goods belonging on the right of ownership, economic management or operative administration to legal persons created as a result of transformation of the commercial organizations to the statutory fund of which those goods had been contributed;;

1.10. alienation of capital constructions (buildings, structures), unfinished capital constructions prepared for preservation, unfinished capital constructions not-prepared for preservation, being in the state ownership and located in the territory of middle, small urban settlements and rural area, is made without selling the right to conclude a lease contract of the land plot necessary for maintaining of the alienated property, if such land plot is given into lease to the buyer. In this instance the land plot is given into lease to the buyer of the property without holding an auction and without collecting the payment for the right to conclude the lease contract, and perennial plantings located in this land plot are transferred to the buyer on a gratuitous basis;

1.11. when alienating capital constructions (buildings, structures), isolated premises, unfinished capital constructions prepared for preservation,  or other immovable property, stakes in the common ownership thereof, unfinished capital constructions not-prepared for preservation, being in the state ownership and located in the territory of middle, small urban settlements and rural area, the buyer is granted, upon his written application, the right to pay by instalments for the mentioned property being purchased by him for the purposes of producing goods (works, services) of own production and/or realizing them for the period indicated in such application, but not longer than five years from the day of  conclusion of the contract of sale, with a monthly indexation of payments and observance of other requirements provided by the legislation on disposal of state property. Calculation of payments in the event of granting the right to pay by instalments is carried out under the procedure established by the State Committee on Property in agreement with the Ministry of Economy and the Ministry of Finance.

The condition for granting the right to pay by instalments in accordance with part one of this sub-clause shall be the commitment of the buyer of the property to organize, within the time limit indicated in the application for granting such a right, but not more than three years from the day of conclusion of the contract of sale, production of goods (works, services) of own production and/or realization thereof.

Control over fulfilment of the commitment of the buyer of the property, indicated in part two of this sub-clause, shall be carried out by the seller of this property and also by state bodies and state organizations in accordance with the legislative acts.

When the buyer of the property does not fulfil the commitment to organize the production of goods (works, services) of own production and/or realization thereof, the right to pay by instalments terminates and the duty to pay for this property is to be fulfilled within 30 calendar days from the day of expiration of the time limit indicated in part two of this sub-clause, under the procedure established by the legislation;

1.12. [ineffective]

2. To recommend to regional councils of deputies to establish decreasing quotients in the amount of not more than 0.5 for the rates of the single tax from individual entrepreneurs and other natural persons for individual entrepreneurs residing and carrying out activity on production of goods (execution of works, rendering of services) in the territory of middle, small urban settlement and rural area.

3. [Not given]

4. [Excluded]

5. Regional councils of deputies shall, within a three month period, determine the procedure for disposal of property being the communal ownership in accordance with this Decree.

6. The Council of Ministers of the Republic of Belarus shall, within a three-month period, ensure bringing the legislation in compliance with this Decree and take other measures necessary for its implementation.

61. To grant to the Council of Ministers of the Republic of Belarus the right to explain the issues of application of this Decree.

7. This Decree enters into force from July 1, 2012 with the exception of clause 5,6 and this clause which enter into force from the day of official publication of the Decree, is temporary and according to the part three of Article 101 of the Constitution of the Republic of Belarus is to be presented for consideration of the National Assembly of the Republic of Belarus.

Sub-clause 1.12 of clause 1 of this Decree is effective till the entry into force of the law of the Republic of Belarus on introduction of respective changes and additions into the Budget Code of the Republic of Belarus.

Till the bringing of the legislation in compliance with this Decree, acts of legislation adopted prior to the entry in force of this Decree are to be applied in the part that does not contradict this Decree.

 

President of the Republic of Belarus

A. Lukashenko

 

* unofficial translation *