By
Kofi Ansah
September 20th, 2022
The country in the heart of Europe adopts the decree on digital economy development that gives the cryptocurrencies the privileged status.
This year the cryptocurrencies have made a meteoric breakthrough. More and more companies offer innovative solutions based on blockchain technology. The world’s wealth is transferring to the digital sphere little by little. However, the critics have always had an ace up their sleeves: the crypto sphere used to be illegitimate. Today they lost this unbreakable argument thanks to Belarus. Or, more precisely, the decree on digital economy development.
Belarus has become the first country to adopt the decree that regulates digital tokens, cryptocurrencies and all the related issues. What is more, the companies working in this sphere can even get tax exemptions and other benefits granted by the decree on digital economy development.
This decree has been actively discussed in the country since summer. Belarus has already provided IT companies with a number of exemptions. Belarusian High Tech Park (HTP) has become one of the driving forces of the country. This is a special economic zone that incorporates completely different companies: IT giants and tiny startups. It is often referred to as Belarusian Silicon Valley. Due to the governmental support HTP managed to create the highly profitable business community which brought the country’s export potential to the new level.
The groundbreaking Belarusian law is also known as “the decree on HTP version 2.0”. To enjoy the benefits of the new tax and legal regime a company has to be a resident of HTP.
Belarus made a significant step: the jurisdiction of the country is the only one regulating all the spheres of blockchain-based businesses. Let us take a closer look at the innovative decree.
- Who can become a member of HTP?
To join High Tech Park a company has to be working in one of the 38 spheres that include:
- cryptocurrencies exchange,
- initial coin offering (ICO),
- mining,
- cryptocurrencies investments and trading operations;
- creation of tokens and other spheres that involve tokens;
- biotech and medical technologies;
- artificial intelligence;
- cybersports;
- unmanned vehicle control systems, etc.
What is more, the list is not closed: HTP can accept companies from other spheres after additional examination.
2. What are the main blockchain regulations?
A natural person can own tokens and commit the following operation:
- mining,
- transacting,
- exchanging,
- buying/selling using all the currencies, including digital ones;
- gifting and demising.
None of these actions is regarded as entrepreneurship – that means they are tax-free.
When it comes to a legal person, things go more complicated. A company or sole proprietor can create tokens and go to ICO in Belarus and abroad. All of the operations on cryptocurrencies markets are also permitted. However, the decree includes one condition for that kind of operations: the broker is to be a HTP resident. Still, using cryptocurrencies is a legal basis for getting tax exemptions.
3. What are the other perks of the decree?
The document is aimed at creating productive business environment for IT companies, that is why it contains a lot of innovations aimed at debureaucratization. For example, the process of transaction in digital currency is simplified; the laws on foreign trade operations are not applied to HTP residents.
The decree contains many benefits for foreign employees. Visa-free entry is extended up to 180 days per year. Moreover, HTP residents do not have to obtain work permits for the foreign IT specialists.
Local IT legalization also gets more freedom: now HTP residents can enter into a wider number of contracts with third parties. And for sure, the document extends the preferential tax regime for these companies. Just as an example: income tax rate is 9%, while other companies pay 16%; profit tax is canceled – instead of it a company gives 1% of gross earnings to the HTP administration.
The importance of the decision of Belarusian government can hardly be overestimated. The adoption of the new decree sets a huge precedent. From now on blockchain-based business obtains a legal status. The decree on digital economy development changed the way people treat cryptocurrencies: you know that your money are legal. At least in one country in the middle of Europe.
