The Constitutional Court of the Republic of Belarus comprising of the Presiding Officer - Chairman of the Constitutional Court G.A. Vasilevich, Deputy Chairman - A.V. Maryskin, judges T.S. Boiko, G.A. Vorobei, V.V. Podgrusha, V.I. Shabailov, G.B. Shishko, V.Z. Shuklin, having examined on the ground of Article 40 of the Constitution of the Republic of Belarus the application of Central board of public association "Belarusian deaf society" concerning the issues of paying purpose dues for maintenance of children's pre-school by Grodno educational and industrial enterprise of Belarusian deaf society established the following.

     1. Central board of public association "Belarusian deaf society" in its application to the Constitutional Court has put an issue on the privileges stipulated in point 9 of the Provision on the procedure of making and use of purpose due for maintenance of children's pre-school establishments of the city of Grodno approved by decision of Grodno urban executive committee of 4 March 1999 No. 185. It envisaged the relief of paying purpose due for the number of payers including societies and associations of disabled persons, enterprises and organizations which use the labour of disabled persons if the number of disabled persons in them is not less than 70 per cent of the average list of the size of industrial personnel, as well as Belarusian association of disabled persons on eyesight and Belarusian deaf society.

     Central board of public association "Belarusian deaf society" considers that release of the enterprises which use the labour of disabled persons if the number of disabled persons in them is not less than 70 per cent of the average list of the size of industrial personnel from paying purpose due for maintenance of children's pre-school of the city of Grodno is not in line with part one of Article 53 of the Law "On social protection of disabled persons in the Republic of Belarus" under which public organizations of disabled persons their enterprises, establishments and organizations shall be released from the profit tax as well as from the dues making into the state budget if there are not less than 50 per cent of employed disabled persons from the number of industrial personnel.

     2. The Constitutional Court considers that preferential taxation of the organizations of disabled persons, their enterprises, establishments and organizations has been determined by the Law "On social protection of disabled persons in the Republic of Belarus" adopted of 11 November 1991.

     The Law of 22 December 1992 has made addenda to Article 3 of the Law of 20 December 1991 "On taxes and dues collecting into the budget of the Republic of Belarus" under which the objects of imposition, the procedure of paying, rates, privileges on each concrete type of tax and due shall be envisaged by special acts of tax legislation of the Republic of Belarus. Insertion of the provisions regulating the issues of taxation in other acts of legislation shall be inadmissible.

     The Law "On social protection of disabled persons in the Republic of Belarus" is not a special act of tax legislation though it contains the norm on taxation of public organizations of disabled persons.

     Based on the title and on the content of Article 3 of the Law "On taxes and dues collecting into the budget of the Republic of Belarus" it is possible to draw the conclusion that the lawmaker while making addenda to the given Article has beard in mind the regulation of the issues of taxation by special acts of tax legislation with regard to all-state taxes and dues only.

     The tax legislation, including while setting local taxes and dues, it has not been always envisaged release from paying relevant taxes and dues of enterprises which use the labour of disabled persons if there are employed there not less than 50 per cent of disabled persons from the number of industrial personnel as it is envisaged by Article 53 of the Law "On social protection of disabled persons in the Republic of Belarus".

     In this connection in practice there are grounds for emerging issues on granting the privileges specified in the given Article of the Law "On social protection of disabled persons in the Republic of Belarus" while setting local taxes and dues.

     3. Imposition of local taxes and dues in relevant administrative-territorial units of the Republic of Belarus shall be regulated by Article 10 of the Law "On the budget of the Republic of Belarus for 1999". In accordance with the specified Article purpose dues for maintenance of children's pre-school establishments, which shall be entered local budgets in full, have been included, in particular, in the system of local taxes and dues in 1999. Before 1999 obligatory payments for maintenance of children's pre-school establishments were accumulated in extra budget funds of local Council of deputies for financing expenses connected with maintenance of departmental pre-school establishments the creation of which has been envisaged by the Resolution of the Supreme Council of the Republic of Belarus of 24 April 1992 "On preservation and development of the system of pre-school establishments".

     Under part six of Article 10 of the Law "On the budget of the Republic of Belarus for 1999" while imposing local taxes and dues local Councils shall independently determine the base and objects of taxation, concrete rates, payers, the procedure of calculation and terms of paying taxes and dues.

     Thus the given norm does not specify directly the right of local Councils of deputies to the establishment of privileges with respect to local taxes and dues, though while realizing the right to determine the payers of local taxes and dues independently, local Councils of deputies by means of releasing the subjects from their payment shall set thereby privileges on the circle of payers.

     In this connection the Constitutional Court emphasizes that the issues of powers of local Councils of deputies in the sphere of setting privileges while imposing local taxes and dues did not secure proper regulation in the effective legislation in spite of the fact, that the local bodies in question enjoy the constitutional right to set those obligatory payments in accordance with the law. In the Constitutional Court opinion the law must clear specify whether local Council of deputies enjoy the right to set the privileges with regard to local taxes and dues.

     4. The Constitutional Court deems it necessary to pay attention to the fact that decision of Grodno urban executive committee of 4 March 1999 No. 185 "On imposition of local dues" in the territory of the city of Grodno since 1 April 1999 it has been imposed, in particular, the due for the service activities of hotels, restaurants, coffee-houses, bars, casinos, exhibitions (with the exception of specialized wholesale exhibitions), exhibitions and sale, tour theatre and concert arrangements (pt. 1); approved the duty rate of five per cent from the sum of services (pt. 2); imposed the purpose due for maintenance of children's pre-school establishments (pt. 4); approved duty rate of five per cent from the fund of wage with charging of the given duty to the product (works, services) costs (pt. 5); approved the provision on purpose due for maintenance of children's pre-school establishments (pt. 6).

     The right to impose certain local dues and taxes including the due for maintenance of children's pre-school establishments is given the local Councils of deputies of based territorial level (part two of Article 10 of the Law "On the budget of the Republic of Belarus for 1999").

     In accordance with sub-item 16 of point 2 of Article 8 of the Law "On local government and self-government in the Republic of Belarus" local Councils of deputies may delegate part of their powers to executive committee. However that delegating may not concern the transfer of powers for imposition of local taxes and dues since under Article 121 of the Constitution of the Republic of Belarus the setting of local taxes and dues shall fall exclusively within the exclusive competence of the local Councils of deputies.

     In spite of the fact that Grodno urban Council of deputies in its decision of 12 March 1999 No. 356 "On the budget of the city for 1999" (adopted after decision of Grodno urban executive committee of 4 March 1999 No. 185) has also imposed since 1 April 1999 purpose due for maintenance of children's pre-school establishments of the city of Grodno and set concrete rate - five per cent of the fund of wage, the given decision of urban Council does not determine such the most important elements of purpose due for maintenance of children's pre-school establishments of the city of Grodno as payers of purpose due, base of imposition, procedure of calculation and terms for payment. All those issues have been regulated by decision of Grodno urban executive committee of 4 March 1999 No. 185 which approved the Provision on the procedure of making and use of purpose due for maintenance of children's pre-school establishments of the city of Grodno.

     With the analysis of the norms of the Constitution and other acts of legislation taking into account the Constitutional Court considers that imposing local taxes and dues is outside the competence of local and administrative bodies. Grodno urban executive committee while adopting decision of 4 March 1999 No. 185 "On imposing local dues" fell out of its competence.

     The Constitutional Court also deems it necessary to pay attention to the fact that point 2 of the Provision on the procedure of making and use of purpose due for maintenance children's pre-school establishments of the city of Grodno which, while determining the fund of wage as an object of imposition by the given due contains the reference to dead Instruction on statistics of labour work force and size of wage, approved by order of the Ministry on Statistics and Analysis of 19 December 1994 No. 12. By Judgment of the Constitutional Court of 24 September 1998 No. J-71/98 sections 9, 10, 11 of the given Instruction were found to be at variance with the Constitution and laws of the Republic of Belarus. The Ministry on Statistics and Analysis of the Republic of Belarus by its order of 11 December 1998 No. 293 has approved new Instruction on the composition of the wage fund and other payments.

     On the grounds of the abovementioned and guided by Article 40 of the Constitution, Articles 36, 37 of the Law "On the Constitutional Court of the Republic of Belarus" the Constitutional Court

RULED:

1. To propose the National Assembly of the Republic of Belarus:

to give interpretation of Article 53 of the Law "On social protection of disabled persons in the Republic of Belarus" in part of compulsory giving the established in it privileges while imposing local taxes and dues or to make necessary alterations in the legislative acts with the purpose of ensuring interconsistency of relevant norms;

to define more precisely the right of local Councils of deputies for setting privileges while imposing by them local taxes and dues.

2. To propose Grodno urban Council of deputies and Grodno urban executive committee taking into account their competence, to regulate imposing of purpose due for maintenance children's pre-school establishments of the city of Grodno on the grounds of the Constitution of the Republic of Belarus, the Law "On the budget of the Republic of Belarus for 1999" and other acts of the effective legislation.

3. To publish the present decision in accordance with the effective legislation.

Presiding Officer —

Chairman of the Constitutional Court

of the Republic of Belarus                                                                                              G.A. Vasilevich