On Ratification of the Protocol between the Government of the Republic of Kazakhstan and the Government of the Republic of Belarus on Amendments and Additions to the Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Belarus on Avoidance of Double Taxation and Prevention of Tax Evasion in Respect of Taxes on Income and Property dated April 11, 1997

The Law of the Republic of Kazakhstan dated April 9, 2018 No. 146-VI SAM.

      PRESS RELEASE

     To ratify the Protocol between the Government of the Republic of Kazakhstan and the Government of the Republic of Belarus on amendments and Additions to the Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Belarus on Avoidance of Double Taxation and Prevention of Tax Evasion in respect of Taxes on Income and Property dated April 11, 1997, signed in Minsk on March 16, 2016.

     President of the Republic of Kazakhstan  

N. NAZARBAYEV

Protocol between the Government of the Republic of Kazakhstan and the Government of the Republic of Belarus on amendments and Additions to the Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Belarus on Avoidance of Double Taxation and Prevention of Tax Evasion in Respect of Taxes on Income and Property dated April 11, 1997

     The Government of the Republic of Kazakhstan and the Government of the Republic of Belarus,

      Desiring to conclude a Protocol on Amendments and Additions to the Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Belarus on the Avoidance of Double Taxation and the Prevention of Tax Evasion in Respect of Taxes on Income and Property, signed in Minsk on April 11, 1997 (hereinafter referred to as the Agreement),

     have agreed on the following:

Article 1

      Subparagraphs (a) and (b) of paragraph 3 of Article 2 of the Agreement shall be worded as follows:

     "a) in the Republic of Kazakhstan:

     - corporate income tax;

     - individual income tax;

     - property tax on legal entities and individuals (hereinafter referred to as "Kazakhstan taxes");

     b) in the Republic of Belarus:

     - income tax;

     - income tax;

     - personal income tax;

     - property tax

     (hereinafter referred to as "Belarusian taxes").".

Article 2

      1. Subparagraph (a) of paragraph 1 of Article 3 of the Agreement shall be worded as follows:

     "(a) The term "Kazakhstan" means the Republic of Kazakhstan and, when used geographically, the term "Kazakhstan" means the State territory of the Republic of Kazakhstan and the zones in which Kazakhstan exercises its sovereign rights and jurisdiction in accordance with its legislation and international law;".

     2. The third paragraph of subparagraph (h) of paragraph 1 of Article 3 of the Agreement shall be worded as follows:

     "in relation to Belarus: the Ministry of Taxes and Duties of the Republic of Belarus or its authorized representative;".

      3. Add the following sentence to paragraph 2 of Article 3 of the Agreement::

     "In this case, any meaning under the tax laws of that Contracting State shall prevail over the meaning given to the term under the other laws of that Contracting State.".

Article 3

      Add the following sentence to paragraph 1 of Article 4 of the Agreement:

     "This term also includes a Contracting State or its local authority.".

Article 4

      1. Subparagraph (f) of paragraph 2 of Article 5 of the Agreement shall be worded as follows:

     "(f) A mine, mine, oil or gas well, quarry or any other place of extraction of natural resources;".

     2. Paragraph 2 of Article 5 of the Agreement should be supplemented with subparagraph (h) as follows:

     "(h) An installation, structure (including a drilling rig), marine vessel or any other place of exploration for natural resources, as well as related surveillance services. This provision applies to enterprises engaged in exploration for another person(s).".

     3. Subparagraph (b) of paragraph 3 of Article 5 of the Agreement shall be worded as follows:

     "(b) An installation, structure (including a drilling rig), marine vessel or any other place of exploration for natural resources, as well as related surveillance services, if such exploration or services have been ongoing for more than twelve months. This provision applies to cases of reconnaissance and surveillance services related to the performance of such reconnaissance, other than those specified in subparagraph (h) of paragraph 2 of this article;".

      4. Paragraph 3 of Article 5 of the Agreement should be supplemented with subparagraph (c) as follows:

     "(c) The provision of services, including consulting services, by an enterprise of one Contracting State through its employees or other personnel employed by the enterprise for this purpose, but only if such activities continue (in relation to the same or related project) in the other Contracting State for a period or periods exceeding in aggregate 183 days in any twelve-month period beginning or ending in the relevant tax year.".

Article 5

      Paragraph 6 of Article 11 of the Agreement shall be worded as follows:

     "6. Interest shall be deemed to arise in a Contracting State if the payer is a resident of that Contracting State. However, if the person paying the interest, regardless of whether he is a resident of a Contracting State or not, has a permanent establishment or permanent base in a Contracting State in connection with which an obligation to pay interest arises, and the costs of such interest are borne by such permanent establishment or permanent base, then Such interest shall be deemed to arise in the Contracting State in which the permanent establishment (representative office) or permanent base is located.".

Article 6

      Paragraph 5 of Article 12 of the Agreement shall be worded as follows:

     "5. Royalties shall be deemed to arise in a Contracting State if the payer is a resident of that Contracting State. However, if the person paying the royalties, regardless of whether he is a resident of a Contracting State or not, has a permanent establishment (representative office) or a permanent base in a Contracting State, in connection with which an obligation to pay royalties arises, and the costs of such royalties are borne by such permanent establishment (representative office) or a permanent base, it is considered that royalties arise in the Contracting State in which the permanent establishment (representative office) or permanent base is located.".

Article 7

      1. Paragraph 4 of Article 13 of the Agreement shall be worded as follows:

     "4. Income earned by a resident of a Contracting State from the alienation of an equity interest or securities equivalent to it in a company whose more than 50 percent of the capital value is directly or indirectly immovable property located in the other Contracting State may be taxed in that other Contracting State.".

     2. Add paragraph 5 to Article 13 of the Agreement as follows:

     "5. Gains from the alienation of any property other than that provided for in the preceding paragraphs of this article shall be taxable only in the Contracting State of which the alienator is a resident.".

Article 8

      Paragraph 1 of article 14 of the Agreement shall be worded as follows:

     "1. Income earned by a resident of a Contracting State in respect of professional services or other activities of an independent nature shall be taxable only in that Contracting State, except in the following cases, in which such income may also be taxed in the other Contracting State:

     (a) If he has a permanent base at his disposal in the other Contracting State for the purpose of carrying on his business; in this case, only that part of the income relating to that permanent base may be taxed in that other Contracting State; or

     (b) If he resides in the other Contracting State for a period or periods not exceeding a total of 183 days in any twelve-month period beginning or ending in the relevant tax year; in this case, only that part of the income derived from activities carried on in that other Contracting State may be taxed in that other State. In A Contracting State.".

Article 9

      Paragraph 3 of Article 15 of the Agreement shall be worded as follows:

     "3. Notwithstanding the preceding provisions of this article, remuneration derived in respect of an employment performed on board a ship, aircraft, road or railway vehicle operated in international traffic by an enterprise of a Contracting State may be taxed in that Contracting State.".

Article 10

      Article 20 of the Agreement should be worded as follows:

"Article 20 Students or interns

     1. Payments that a student or trainee who is or was a resident of one Contracting State immediately prior to arrival in the other Contracting State and is located in the other Contracting State solely for the purpose of education, internship, receives for the purposes of his maintenance, education, internship, shall not be taxed in the other Contracting State, provided that such payments Payments are made from sources outside that other Contracting State.

2. In respect of grants, scholarships and remuneration from employment not specified in paragraph 1 of this article, the student or trainee referred to in paragraph 1 of this article, during such studies, internships, shall be entitled to the same benefits, discounts or deductions in respect of taxes granted to residents of a Contracting State, in particular in which he dwells.".

Article 11

     To supplement the Agreement with Article 20-1 as follows:

"Article 20-1 Professors, teachers, and researchers

     1. A professor, lecturer or researcher who is or was a resident of one Contracting State immediately prior to his arrival in the other Contracting State and who, at the invitation of a university, college, school or other similar educational institution recognized by the Government of the other Contracting State, is in that other Contracting State solely for the purpose of teaching and/or conducting scientific work in such an educational institution, shall be exempt from taxation in that other Contracting State for a period not exceeding 24 consecutive months from the date of his first arrival in that other Contracting State in respect of remuneration for such teaching or scientific work.

     2. The provisions of paragraph 1 of this article shall not apply to income from scientific research if such research is conducted not in the interests of the State, but for the personal benefit of a particular person or persons."

Article 12

      Article 26 of the Agreement should be worded as follows:

"Article 26 Exchange of information

      1. The competent authorities of the Contracting States shall exchange information necessary for the implementation of the provisions of this Agreement or the administration or application of national legislation relating to taxes of any kind and type levied on behalf of the Contracting States, their central or local authorities, insofar as taxation is not contrary to this Agreement. The exchange of information is not limited to articles 1 and 2 of this Agreement.

     2. Any information received by a Contracting State in accordance with paragraph 1 of this Article shall be considered confidential, as well as information received in accordance with the national legislation of that Contracting State, and shall be disclosed only to persons or authorities (including courts and administrative authorities) engaged in both assessment or collection, enforcement or prosecution, or consideration of appeals in respect of taxes referred to in paragraph 1 of this article, as well as supervision of all of the above. Such persons or authorities may use the information only for such purposes. They may disclose information during an open court hearing or when making court decisions.

     3. The provisions of paragraphs 1 and 2 of this article may not be interpreted as imposing an obligation on a Contracting State.:

     (a) To take administrative measures contrary to the laws and administrative practices of that or another Contracting State;

     (b) To provide information that cannot be obtained under the laws or in the ordinary course of the administration of that or the other Contracting State;

     c) provide information that would disclose any trade, business, industrial, commercial or professional secret or trade process, or information the disclosure of which would be contrary to government policy (ordre public).

     4. If information is requested by one Contracting State in accordance with this Article, the other Contracting State shall take measures to collect the requested information, even if such information is not required by that other Contracting State for its own tax purposes. The obligation contained in the previous sentence is subject to the limitations of paragraph 3 of this article, but such limitations cannot be interpreted as allowing a Contracting State to refuse to provide information solely because of a lack of domestic interest in such information.

     5. The provisions of paragraph 3 of this Article may not be interpreted as authorizing a Contracting State to refuse to provide information solely because the holder of the information is a bank, another financial institution, a nominee holder or a person acting as an agent or attorney, or because the information concerns a person with ownership rights.".

Article 13

     For the purposes of applying the Agreement, the fact of residence of a person who is a resident of a Contracting State is certified by an original document confirming residence issued and certified by the competent authority of that Contracting State. At the same time, the legalization of the signature and seal of the authority that issued and certified this document is not required under the national legislation of the Contracting States or an international treaty to which the Contracting States are parties.

Article 14

     1. This Protocol shall enter into force on the date of receipt, through diplomatic channels, of the last written notification that the Contracting States have completed the internal procedures necessary for the entry into force of this Protocol.

     2. This Protocol applies:

     (a) In respect of taxes withheld at source on income earned on or after the first of January of the calendar year following the year in which this Protocol enters into force;

     (b) In respect of other taxes on income and on property, on income or on assets for any taxable year beginning on or after the first day of January in the calendar year following the year in which this Protocol enters into force.

     In witness whereof, the undersigned, being duly authorized thereto, have signed this Protocol, the provisions of which are an integral part of the Agreement.

     Done in Minsk on March 16, 2016, in two copies, each in the Kazakh, Belarusian and Russian languages, all texts being equally authentic. In case of discrepancies in interpretation, the text in Russian will prevail.

     For the Government of the Republic of Kazakhstan  

For the Government of the Republic of Belarus

President    

Republic of Kazakhstan     

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