http://www.themoscowtimes.com/stories/2006/03/15/003.htmlKeeping Tabs on Wire Transfers in Minsk
By Anastasiya Lebedev
Staff Writer If you wire money to your grandmother in Minsk, be forewarned: Belarussian President Alexander Lukashenko's administration will hold it in trust until she gives the government a detailed report on what she's going to do with it.
Any funds wired to Belarussians from abroad will only be released, after some delay, if the recipient is able to satisfy a list of requirements. The recipient must also pay a 30 percent tax, unless the sender is a Belarussian citizen or a close relative, and able to prove it.
Marina, an employee at a Moscow telecommunications company, found all this out the hard way when she attempted to send her aunt Lidia some money for her birthday in mid-December. She pooled funds with her mother and wired the struggling Minsk pensioner $800 through Western Union. The money was intended to help support Lidia for the entire next year, as her monthly pension of about $97 is insufficient to cover even food and transportation expenses.
Instead of enjoying the birthday gift, however, Marina said her aunt spent the next two weeks crying until she finally succeeded in getting the money released.
Marina and Lidia are not their real names; the women said they were afraid to be identified even by their first names out of fear of retribution from the Belarussian authorities. Lukashenko, who is running for a third term as president on Sunday, tolerates no dissent.
The presidential administration's Department of Humanitarian Activities requires the recipients of money transfers above the equivalent of about $405 to submit an application, proof that the funds have been deposited in a "charity account" at a Belarussian bank, a plan for using the money, copies of passports and "other documents the department may request for determining ... the purpose of the foreign aid."
Marina said that her aunt, who has poor eyesight, went to the Western Union window at the state Belvneshekonombank to claim the money. "They slipped her a bunch of papers, she signed them without looking, they told her to go to the central office, she signed more papers. Then they told her, 'Look what you've signed.'"
Lidia learned that she had just transferred all her money into a charity account and now had to apply to the Department of Humanitarian Activities, which would take two weeks to review her application. "They said the farther she is from politics, the more money she'll get," Marina said.
Lidia was also incorrectly informed that after she received the money, she would have to hand over 30 percent in taxes. In the end, she did not have to pay the taxes, since Marina qualified as a close relative.
The measures date back to June 2004, when Lukashenko's administration issued new instructions for processing money transfers from abroad requiring that all money be disbursed by the Department of Humanitarian Activities.
The list of approved uses includes research, "social aid to people with low income and other purposes determined by the presidential administration as per agreement with the president of Belarus."
A Belvneshekonombank representative said the rules did not apply to foreigners in Belarus.
A former reporter for a major Belarussian newspaper recalled a storm of phone calls to the newspaper's office when people began to learn about the new rules. The Department of Humanitarian Activities has only one office, located in Minsk, yet people from the most remote villages of Belarus were obliged to submit the necessary paperwork within five days of receiving the transfer or face fines of 20 to 200 basic units ($270 to $2,700). The basic unit is a conventional, variable figure used in fiscal matters, currently set at 29,000 Belarussian rubles ($13.50).
The reporter declined to give her name, citing a December change to the Belarussian Criminal Code that punishes "discrediting the republic of Belarus" with up to two years in jail.
The department's web site says that those who do not deposit the money into the charity account are liable for a fine of 20 to 200 basic units. Using the money is forbidden before it is deposited into the charity account and the permission to use it is granted, and violation of those terms is punishable by a fine of 50 to 100 basic units. The fund is called a "charity" because any money wired in by foreigners is considered foreign aid.
If the recipient refuses to sign the transfer, the funds are returned to the sender, minus transfer fees.
At the time the law was passed, it was explained as aimed at preventing the foreign financing of political activity in Belarus. Lukashenko has stated that he will not stand for any Belarussian "color" revolutions like those that have occurred in Georgia and Ukraine in the last two years, and were supported by the West.
In July 2005, the instructions for processing foreign money transfers were amended to apply only to amounts over 30 basic units (about $405). Smaller money transfers are now accepted, but many recipients still must file an income tax declaration within 30 days.
Irina Ilyukevich of the Belarussian tax ministry's declaration department said that funds received from close relatives were not taxed, but to claim that exemption, recipients must provide proof of kinship. She said that money wired by Belarussian citizens was not considered foreign aid, but that Belarussian citizens who wired money from abroad had to file a tax declaration on foreign income and pay the taxes the next time they entered the country.
In part because of the tax, Belarussians all over the world have taken to arranging to have money handed over personally. Eugene Hrusza, the president of the Federal Council of Belarussian Organizations in Australia, said that no Belarussians he knew wired money back home anymore.
"People got the news that the government is taxing those who receive it, and they stopped sending it. Usually, they pass the money through people going to visit Belarus," he said by telephone.
The same rules apply to funds wired from abroad to organizations in Belarus. Hrusza recounted a situation when the Australian Belarussian community wanted to sponsor the publishing of a book in Belarus on Belarussians in Australia, but gave up on sending the money because of the high tax.
"The government tried to tax it 33 cents on the dollar, so we asked to have it returned," he said.
Marina, who had wired the money to her aunt, complained that she wasn't warned by Western Union about the potential complications for those trying to receive the money. Kurt Marx, Western Union's Eastern Europe and CIS vice president, confirmed that the company's web site did not list any information about the limitations on money transfers to Belarus, but said the company's operators were required to inform clients of pertinent limitations at the point of destination. He also said that Western Union was aware of the legislative changes in Belarus, but that it was not aware of any problems with the payment of funds to any of its clients in Belarus.
"Belarussian authorities are afraid of everything," said Anatoly Lebedko, chairman of the opposition United Civil Party. "They want to control everything, including money wired in, because they are seeing some kind of a revolution everywhere, they think someone's going to finance anti-Lukashenko activities."
Lebedko said that fear was the main reason Belarussians did not protest such regulations, which he said were a violation of their rights.
