(BelTA) – The Council of the Republic of the National Assembly of the Republic of Belarus approved the bill on ratifying the protocol to the Belarus-Turkmenistan intergovernmental convention on avoiding double taxation with regard to income and capital (property) taxes on 18 April, BelTA has learned.

The bill was approved by the House of Representatives of the National Assembly on 2 April 2013. The protocol is meant to rule out double taxation for the services rendered by the Belarusian party in the project to build the Garlyk mining and processing factory in Turkmenistan. The services include pre-design ones, engineering, designing, research, education, education organization services and other ones.

The protocol specifies several provisions of the convention. In particular, a state can tax only the services rendered in the said state. The profit of a permanent representation of an enterprise that operates in the other state is calculated without the gross income and the cost of services, which are rendered not in the other state.

Now the protocol is applicable to relations that emerged as from 1 January 2010, the moment when the state concern Turkmenhimiya and OAO Belgorhimprom signed the contract.

The protocol is designed to enable favorable taxation conditions for investors and develop economic ties between economic entities of the two countries.

In her speech before the upper chamber of the Belarus parliament Deputy Tax Minister Ella Selitskaya explained that the protocol is aimed at ruling out double taxation and guarantees a stable taxation regime for all the Belarusian investors during their operation in Turkmenistan.

In 2010 Belgorhimprom and Turkmenhimiya signed a contract to design and build a mining and processing factory with the capacity of 1.4 million tonnes of potassium chloride per annum at the Garlyk potash salts deposit in Turkmenistan.

In 2012 major production sector and civil engineering companies such as OAO Belaruskali, OAO Trest Shakhtospetsstroi, OAO Promtechmontazh as well as other construction organizations of the Belarusian Architecture and Construction Ministry were employed for the project. The project is scheduled for completion by 2015.