09-08-2012 10:55 Belarus
Belarusian corporations to transfer 10% of profit tax to innovation funds
The procedure for replenishing innovation funds in Belarus will be changed. In particular, prime cost deductions have been replaced by profit tax deductions, the press service of the State Committee for Science and Technology told BelTA.
The changes have been brought about by Belarus President decree No. 357. All Belarusian corporations will have to transfer 10% of the profit tax to innovation funds. The move will not change the profit tax rate and the tax burden on organizations of all types of ownership. The money will be transferred by financial agencies out of the profit tax paid by economic entities.
The number of the organizations that take part in replenishing innovation funds will grow larger. Now any economic entity that pays profit tax regardless of the type of ownership will be able to form innovation funds.
Applications for the money accumulated by innovation funds have been changed. Both state-run and private corporations alike will be able to tap into these resources, provided they meet project efficiency requirements. Innovation fund money will be made available only via open tenders with rather rigorous novelty, technological edge, and economic effectiveness criteria.
Non-state organizations that will receive money from innovation funds will not have to transfer part of their authorized fund as much as they get into ownership of the republic. The novelty is expected to encourage non-state enterprises to get money from innovation funds for the sake of innovative high-tech and economically effective projects.
Innovation funds will be set up in a way similar to the one used to set up dedicated state budget funds. Central state administration bodies will set up republican innovation funds while oblast administrations and Minsk City Hall will set up local innovation funds.
The Council of Ministers will have the right to re-distribute money of republican innovation funds between administrators. If important projects have to be financed, a government resolution may increase income and spending of an innovation fund by relevantly reducing income and spending of the innovation funds run by other administrators. It will allow concentrating funds for the sake of implementing major projects.
All in all, the novelties will allow improving the profitability of the economic entities that now transfer money to innovation funds. Thanks to reduced prices (due to the cancelation of prime cost deductions) enterprises will be able to bolster the competitive ability of their products on the home market and abroad.