Belarus - Politics, government, and taxation

There are 3 governmental branches in Belarus: the executive, including the president, prime minister, and council of ministers; the legislative, consisting of parliament; and the judicial, or the Supreme Court. Belarus has a president as the head of the state, who serves a 5-year term. The president appoints the prime minister, who is the head of the government. A bicameral (2-house) parliament consists of the 64-seat Council of the Republic and the 110-seat Chamber of Representatives. Judicial power in Belarus is in the hands of courts. The Constitutional Court exercises control over constitutionality (determination of legal validity based on the constitution) of acts and decrees. Administratively, the country is divided into 6 oblasts (administrative divisions). Local administration and decision making are carried out primarily by the Soviets of Deputies. There are several registered political parties: the Belarusian Popular Front, Party of Popular Accord, Union of Belarusian Entrepreneurs, Belarusian Party of Communists, Belarus Peasant Party, Belarusian Socialist Party, Social Democrat Party, Agrarian Party of Belarus, and United Democratic Party of Belarus.

President Lukashenka consolidated his power through a highly controversial election held in 1994. Based on the results of this vote, the Constitutional Court lost its independence, and the democratically elected parliament was abolished and replaced by presidential appointees. President Lukashenka used his increased power to suppress the freedoms of speech, press, association, and assembly. He also eliminated the system of checks and balances over the executive branch. In 1996 Lukashenka extended his term, which should have ended in 1999, to 2001.

Taxes are the primary source of government revenue. The taxation system of Belarus includes national and local taxes as well as other types of taxes and duties . National taxes are collected throughout the country and transferred to the national budget and extra-budgetary state funds. Local taxes are levied only within respective administrative and territorial units and transferred to local budgets. Belarus signed international agreements on avoiding double taxation with a number of countries. The country took steps to liberalize taxation and customs regulations, granting some benefits to investors in the 1990s. Belarusian laws allow foreign entities to make direct private investments in the Belarusian economy through the creation of joint ventures with as much as 100 percent participation of foreign capital.

From 1993 to 1999, investments in Belarus totaled US$697 million, a low figure compared to other former Soviet countries. The bulk of foreign investment came from Gazprom (Russia's state-owned gas company). The Yamal pipeline project funded by Gazprom will export natural gas to Western Europe via Belarus. Western investors in Belarus include the Coca-Cola company, which has been building a US$50 million plant in the capital city of Minsk, and Ford Motor Company, which holds a 51 percent stake in a truck assembly plant outside of Minsk.