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Liberalization Of Price Control In Belarus

Liberalization Of Price Control In Belarus
Prime-Tass
Belarus has made two significant steps to liberalize price control. The first one was ordinance #694 of the president dated December 30, 2007 exempting companies that enjoy simplified taxation schemes, and individual entrepreneurs that pay the unified tax, from the requirement to meet price index limits and substantiate prices [tariffs, rates] by calculations.
The exemption does not apply to the entities providing medical services. The ordinance exempts farms and economic entities trading via OAO Belarusian Mercantile Exchange from the requirement to justify prices. Also, entities providing international freight and passenger transportation services, including transit, have been exempted from requirements to meet price index limits and justify prices and tariffs, as well as from sanctions for the failure to provide justifications. Earlier, preferences were applied only to freight transport by road.
Lukashenko also abolished fines that used to be imposed on directors of legal entities for non-production of substantiations of new prices. However, fines still remain under article 12.4 of the Administrative Offenses Code.
The head of state also approved the list of state agencies responsible for informing enterprises about price index changes and limits.
Administrative authorities are supposed to notify subordinate organizations with state stakes; the Health Ministry will inform all entities providing for-fee medical services; the Economy Ministry will notify providers of electric power that are not subordinate to Belenergo; and region administrations and Minsk city administration will notify the remaining legal entities and individual entrepreneurs.
The other move to liberalize price control was resolution #252 of the government adopted in pursuance of ordinance #694. The government extended the list of commodities [services and operations] with prices [tariffs] not subject to registration: prices for brewer’s malt and beer, prices for accompanying goods produced during processing of farm produce, prices for waste products and goods produced from waste products, prices for folk crafts products, prices for tickets to cultural events taking place during festivals and tours, prices for services during expositions, conferences, presentations, seminars, workshops, lectures, etc. and entrance tickets.
Also, the government crossed out tariffs for freight and passenger transportation services by all means of transport from the list of prices and tariffs subject to registration [earlier, road transport fees were the only exclusion]. Advertising services fees have also been crossed out [the exemption used to be applied only to television advertising]. The government also specified the term “single order”. A single order is the one performed once in twelve months.
The resolution vested in republican public authorities the powers to register prices and tariffs of subordinate enterprises with stakes belonging to the state. Earlier, prices were registered by region administrations and the administration of the city of Minsk.
Since many companies have separate services responsible for price formation that are not subordinate to the chief accountant, the resolution entitled heads of relevant services to authenticate economic calculations to substantiate prices.
Legal experts warn that despite the exemptions and extended list of organizations that do not have to have their prices registered, businesses still have to form prices in accordance with resolution #43 of the Economy Ministry dated April 22, 1999.
Companies must substantiate prices for their products, services and work on the basis of indexes set by the government. When they are unable to meet the indexes, companies are supposed to have their prices, tariffs and fees registered. Prices for new products, services and work also must be registered.

 

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