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On 19 December 2014, the Belarusian Senate approved Tax Code amendments for 2015. The key amendments are summarized as follows:

Corporate Taxation

  • The reduced 9% capital gains tax rate on gains from the sales of shares is abolished, and the 18% rate applies
  • The corporate tax rate for banks and insurance companies is increased from 18% to 25%

Individual Taxation

  • The individual income tax rate is increased from 12% to 13%, although additional deductions will be allowed

Transfer Pricing

  • The scope of the Belarusian transfer pricing rules is expanded to cover the sale of works and the provision of services (previously only immovable property transactions and transactions involving goods are covered)
  • The minimum transaction value threshold of BYR 60 billion is reduced to BYR 1 billion
  • The comparable profits method is introduced as one of the acceptable transfer pricing methods, which also includes the comparable uncontrolled price (CUP) method, the resale price method, and the cost-plus method

Thin Capitalization

  • The scope of controlled debt subject to thin capitalization rules is expanded to include not only controlled debt obligations to a foreign organization directly or indirectly controlling 20% or more of a Belarusian entity, but also:
    • Debt obligations to affiliates of such a foreign organization,
    • Debt obligations guaranteed by such a foreign organization or affiliates
  • Contractual penalties and fines related to loan agreements are considered controlled debt subject to thin capitalization rules, as well certain fees and other expenses including fees payable under management, engineering, informational, marketing and consulting services agreements, expenses for the acquisition or use of trademarks and service marks, and amortization of industrial property
  • A 1:1 debt to equity ratio is introduced for manufacturers of alcoholic beverages with an alcohol amount of up to 7% and goods subject to excise duty, and for fees and expenses considered controlled debt as above when owed to Belarusian resident company that holds more than 20% of the shares in the debtor company

Value Added Tax

  • VAT Exemption is introduced for payments received in the course of a finance lease arrangement with an option to purchase the lease object provided that the lessee is an individual
  • VAT Exemption is introduced for proceeds from the sale of intellectual property rights, such as rights to inventions, utility models, industrial design, breeding achievements, integrated circuit topographies and know-how

The amendments to the Tax Code generally apply from 1 January 2015.