Preferential terms regarding commercial organizations engaged in production activities in rural areas have been introduced by the current Decree of the President of the Republic of Belarus of 07.05.2012 N 6 "On stimulating entrepreneurial activity in the territories of medium and small urban settlements, rural areas" (hereinafter referred to as Decree N 6).

Decree N 6 provides for incentives for entrepreneurial activity in rural areas, including benefits for commercial organizations and individual entrepreneurs in terms of:

• payment of taxes (levies, duties) and customs duties,

• mandatory sale of foreign currency,

• mandatory conclusion of transactions on exchange trading when purchasing raw materials, components, and materials for own production,

• foreign trade in goods of own production,

• acquisition of state-owned property located in rural areas.

General conditions for applying benefits

The following categories of entities are eligible for benefits:

1. commercial organizations of the Republic of Belarus, registered in the Republic of Belarus with their location in the territories of medium and small urban settlements, rural areas,

2. commercial organizations of the Republic of Belarus having separate divisions established in the territories of medium and small urban settlements, rural areas;

3. individual entrepreneurs registered in the Republic of Belarus with their place of residence in the territories of medium and small urban settlements, rural areas.

Provided Decree by Decree N 6, the benefits apply on the condition that such commercial organizations, their separate divisions, and individual entrepreneurs carry out activities for the production of goods (performance of works, provision of services) in the territories of medium and small urban settlements, rural areas.

Provided Decree Decree N 6 benefits are applied by commercial organizations of the Republic of Belarus and individual entrepreneurs within 7 years from the date of their state registration..

Based on subparagraph 1.8 of paragraph 1 of Decree N 6, the benefits provided by Decree N 6 do not apply to:

• banks, non-bank credit and financial organizations, investment funds, insurance organizations;

• professional participants in the securities market;

• residents of free economic zones and the High-Tech Park, the "Augustow Canal" special tourist and recreational park, the China-Belarus Industrial Park;

• commercial organizations, individual entrepreneurs, separate divisions in terms of their carrying out:

  - real estate agency activities;
  - gambling business activities;
  - lottery activities;
  - activities related to the organization and conduct of electronic interactive games;
  - production and (or) sale of excisable goods;
  - production and (or) sale of jewellery made from precious metals and (or) precious stones;
  - production of securities, banknotes and coins, postage stamps;
  - activities within a simple partnership.

In accordance with the Decree, commercial organisations of the Republic of Belarus, individual entrepreneurs registered in the Republic of Belarus with their location (residence) in the territory of medium and small urban settlements, rural areas (hereinafter, unless otherwise provided by this Decree, referred to as commercial organisations, individual entrepreneurs), and carrying out activities for the production of goods (performance of work, provision of services) in the territory of medium and small urban settlements, rural areas, for seven calendar years from the date of their state registration:

are entitled not to calculate and not to pay profit tax (commercial organizations) and personal income tax (individual entrepreneurs) respectively on profits and income derived from the sale goods (of) own production (of goods, services);

are exempted from payment state duty for the issuance of a special permit (Licenses) for the carrying out by legal entities and individuals of certain types of activities (including those related to specific goods (works, services)), making amendments and (or) additions to such special permit (license), extending the term of its validity;

may not calculate and pay other taxes, duties (fees) – property tax from the cost of capital structures (buildings, structures), their parts, parking spaces, located in the territory of medium and small urban settlements, rural areas, - when carrying out activities for the production of goods (works, services) in the territory of medium and small urban settlements, rural areas;

are exempted from mandatory sale of foreign currency, received from transactions with non-resident legal entities and non-resident individuals from the sale goods (of goods, services) of own production, as well as from leasing out property;

exemption from import customs duties and VAT on goods imported into the territory of the Republic of Belarus, provided that the imported goods are classified according to the unified Commodity nomenclature foreign economic activity of the Customs Union in commodity positions 7301, 7302, 7308, 7309 00, 7311 00, 8401 - 8408, 8410 - 8481, 8483, 8484, 8486, 8487, 8501 - 8519, 8521 - 8523, 8525 - 8537, 8543, 8545, 8601 - 8609 00, 8701, 8702, 8704 - 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 00, 9503 00 - 9508goods are imported as a contribution to the charter capital of organizations within the periods established by the constituent documents for the formation of such capital; the total value of the goods shall not exceed the amount of the non-monetary contribution specified in the constituent documents of the organizations.

The sale of goods (works, services) of own production means:

as regards commercial organizations - the sale of goods (works, services) of own production during the period of validity of the certificate of goods of own production (certificate of works and services of own production), issued in the manner prescribed by law to commercial organizations carrying out their sale.

In addition, the Tax Code of the Republic of Belarus provides for benefits for each tax established by law (VAT, profit tax, land tax, property tax, environmental tax, income tax, and others).