To stimulate the development of foreign trade and narrow dif-ferences in the levels of economic development of different regions with due account of their specialisation, natural, geographic and resource features, three free economic zones (FEZ) have been organised in the Republic of Belarus, which have started their development. Brest Complex Free Zone has been organised for 50 years and unites in its activities the functions of economic, production, free customs, tourist and recreational, insurance and banking spheres. The territory of the zone is 70 km2. The zone attracts attention of small-scale and medium-scale businesses that are ready to invest (up to 5 million US dollars) for implementing small projects on development of trade, manufacture of construction materials, medicinal preparations, woodworking, and various services.

Minsk Free Economic Zone specialises in creation and development of production facilities based on new and high technologies; it possesses a developed production, intellectual and export potential of the region including the City of Minsk and the Minsk Oblast. The development of the FEZ presumes the building of the export potential of enterprises located in Minsk and the Minsk Oblast on the basis of their technical and technological updating and their inclusion into single technological chains not only in this region but also in the Republic as a whole, the deployment of a large transit transport centre in Minsk-2 National Airport, the organisation of technological parks and production facilities for operation, repair and maintenance of aviation machinery as well as of a network of services and communal servicing of aviation and automobile transportation. The Zone is located on 8 sites occupying 1,390 hectares. The Zone was set up for 30 years.

Gomel-Raton FEZ was set up on the basis of Raton Scientific and Production Amalgamation and the adjacent territory including 4,300 hectares. Its development is aimed at forming a compact export and industrial technological centre of science-intensive enterprises as a model variant for practical testing of all aspects of the Zone's operation and for disseminating the acquired experience to other enterprises and amalgamations of the country and to new FEZs to be organised, in particular FEZs now projected in the Oblast centres Vitebsk and Grodno. The prospects of development of Gomel-Raton FEZ will be determined, in many respects, by the conversion measures under way, in particular, in the sphere of precision machine building and radio and electronics.

To encourage the development of FEZs in the Republic, a number of privileges and other measures of state support for residents of free zones - both domestic and foreign - is stipulated.

Residents of FEZs will have the reduced rates of the tax on profits and incomes by 15% as well as on the income tax from citizens, a 10% reduction on the VAT and the ecological tax, fees for social insurance, state duties, excise and other duties. Residents whose profits are formed at the expense of realisation of their own products and services are exempted from the tax on profits for the first 5 years. When residents supply their own products in the amount of not less than 70%, the tax on profits for the next 5 years is calculated as 50% of the existing rate of this tax. Dividends of the residents of FEZs are not subject to taxation during 5 years from the time of their registration.

A simplified system of taxation for residents that are subjects of small entrepreneurship has been introduced whereas the general procedure of payment has been preserved only in relation to 8 kinds of taxes. The rate is established at 10% of the total revenues or the gross income.