Belarus introduces tax restrictions for companies from unfriendly countries

In response to Western sanctions, the Government of Belarus imposes tax restrictions on organisations from unfriendly countries, as stipulated by Council of Ministers Resolution No. 164 of March 7th, 2024, which is officially published on the National Legal Internet Portal, BelTA reports

The document establishes a 25 per cent tax rate on dividends and similar income for foreign organisations that do not operate in Belarus through a permanent establishment from April 1st, 2024, to December 31st, 2026. Currently, the tax rate is 15 per cent.

The resolution also refers to the suspension of the provisions of international agreements on the avoidance of double taxation until December 31st, 2026, inclusive. At the same time, the period of application of the retaliatory measure may be shortened in case of the elimination of the circumstances that served as the basis for its application, or at the suggestion of the Ministry of Taxes and Duties of the Republic of Belarus.

The Ministry of Foreign Affairs was instructed to send notifications to the parties to international agreements on the suspension of the implementation of their individual provisions, and the Ministry of Finance, together with the Ministry of Taxes and Duties and other interested parties, to work out the feasibility of changing the rates of income tax, personal income tax, and income tax of foreign organisations not operating in Belarus through a permanent establishment, on dividends and income equated to them.

This resolution shall enter into force as follows: suspension of the provisions of international agreements on the avoidance of double taxation shall enter into force on the first day of the month following the expiration of two months from the date of official publication of this resolution; other provisions shall enter into force after its official publication.