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Economy
20 June 2018, 16:48

Forthcoming measures to ease up tax pressure on Belarusian companies revealed

MINSK, 20 June (BelTA) – A number of measures are being worked out to reduce the tax burden on the Belarusian private sector, BelTA learned from a recent interview of Belarusian Deputy Finance Minister Dmitry Kiyko with the Finance, Accounting, and Audit magazine.

According to the source, as part of the comprehensive revision of the Tax Code there are plans to take measures to reduce the tax burden on commercial entities due to their reinvesting profits into business development and new jobs in line with the Entrepreneurship Development Ordinance. Among such measures Dmitry Kiyko mentioned the broader use of the existing profit tax deduction for investment purposes. For instance, the size of the deduction can be increased or its additional use in the next tax period can be authorized.

The other measures include a lower profit tax on dividends if the earned profits are not distributed for three years and the full exemption from taxes if the profits are not distributed for five years. There are plans to exempt new manufacturing facilities and their land plots from the real estate tax and the land tax for the first year of operation in addition to reducing the rates of these taxes for a period starting with the second year and ending with the fifth year.

Apart from that, the revised Tax Code will implement measures to bring together tax accounting and business accounting. It will be done primarily by removing time differences for recognizing several kinds of revenues and expenses and by unifying the date for compiling the primary accounting records. There are plans to simplify the standardization of individual expenses, which are used for taxation purposes (the cost of business trips, fuel costs and so on). The procedure for applying the simplified taxation system will be improved. Some restrictions on input VAT sums will be lifted.

Apart from that, approaches to granting tax preferences and extending their period of effect may be considered, in particular, by separating them into three categories, classifying stimulating tax preferences as temporary ones, and introducing tax preference passports. At the same time the right of municipal councils of deputies to set multiplying coefficients for the land tax and the real estate tax will be curbed.

“At the same time I should note that the current efforts to revise the Tax Code will not bring about structural changes such as changes of the number and the composition of tax payments. Measures to keep the tax system stable in the face of external shocks are supposed to be worked out over the course of three years after the new revision of the Tax Code is adopted (in 2019-2021). They will be implemented starting 2022,” stated the Belarusian deputy finance minister.

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