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Authorities set to raise VAT rate from 20 to 22 percent

 

The government has drawn up changes to the Tax Code providing for an increase in the rate of value added tax from 20 to 22 percent in 2014, BelaPAN has learned.

At the same time, the government plans to lower the rate of profit tax from 18 to 12 percent.

The authorities expect the reduction in the profit tax rate to decrease the tax burden on exporters, which do not pay value added tax.

At the same time, the higher value added tax rate is expected to push up the prices of imported goods.

When reached by BelaPAN, Alyaksandr Kalinin, chairman of the Belarusian Union of Entrepreneurs, said that the government had not consulted with business associations while deciding on the tax hikes.

Kazakhstan and Russia, with which Belarus shares the Customs Union and Common Economic Zone, have value added tax rates of 12 and 18 percent, respectively. Ukraine plans to cut the rate of value-added tax from 20 to 17 percent in January 2014.