DATE: JANUARY 2, 1996

PART 1

HOW TO USE VALUE ADDED TAX, EXCISES AND SPECIAL TAX ON GOODS IMPORTED AND EXPORTED FROM THE REPUBLIC OF TAJIKISTAN.

1.VALUE ADDED TAX (VAT)

1. GENERAL PROVISIONS
----------------------
VAT OF 20 PERCENT IS IMPOSED ON GOODS IMPORTED TO TAJIKISTAN, EXCLUDING SPECIFIC PRODUCTS STIPULATED BY THE TAJIK LEGISLATION.

SELECTED GOODS ARE SUBJECT TO EXCISE TAXES (SEE APPENDIX 1).

COMMODITIES WHICH ARE SUBJECT TO VAT ARE CHARGED A SPECIAL TAX AS WELL.

VAT, EXCISES, AND SPECIAL TAX ARE COLLECTED IN TAJIK RUBLES FOR STATE'S BENEFIT.

2. PAYERS OF VAT, EXCISE, AND SPECIAL TAX
------------------------------------------
VAT, EXCISE, AND SPECIAL TAX ARE PAID BY THE DECLARER OR OTHER JURIDICAL BODY SIMULTANEOUSLY WITH PAYMENT OF OTHER CUSTOMS FEES, WHICH MEANS BEFORE OR AT THE PRESENTATION OF THE CARGO CUSTOMS DECLARATION. THE CONTRACT HOLDER IS CHARGED A FINE IF PAYMENTS ARE DELAYED OR SUBJECT TO RECALCULATIONS (INCLUDING CUSTOMS VALUE CORRECTIONS).

3. ORDER OF EXCISE CALCULATION
-------------------------------
EXCISES ARE CALCULATED IN TAJIK RUBLES ON THE FOLLOWING FORMULA:
C X E / 100
C - CUSTOMS VALUE IN RUBLES
E - EXCISE RATE
X - MULTIPLYING SIGN
/ - DIVISION SIGN

4. ORDER OF VAT AND SPECIAL TAX CALCULATION
--------------------------------------------
VAT AND SPECIAL TAX ARE CALCULATED IN RUBLES ON THE FOLLOWING FORMULAS:
(C + F + E) X H / 100

FOR COMMODITIES WHICH ARE SUBJECT TO CUSTOMS DUTIES BUT NOT SUBJECT TO EXCISES:
(C + F) X H / 100

OTHER COMMODITIES
C X H / 100
C - CUSTOMS VALUE
F - CUSTOMS FEE
E - EXCISE
H - EXCISE RATE
X - MULTIPLYING SIGN
/ - DIVISION SIGN
+ - ADDITION SIGN

5. RELIEF FROM VAT AND SPECIAL TAX PAYMENT
--------------------------------------------
The following are to exempted from VAT and special tax:
A) goods for official use of foreign diplomatic missions and their personnel, including personal property of diplomatic and administrative-technical staff and their family members residing together.
B) national and foreign currencies, and banknotes which are legal means of payment, excluding those used as numismatic specimen, securities (shares, bonds, certificates, bills and others).
C) humanitarian assistance
D) automotive vehicles to prevent disablement and to rehabilitate invalids, medications, medical devices, prosthetic appliances, medical equipment, spare parts, and raw materials for its production.
E) food products, excluding those which are subject to excises, and raw materials to produce them.
F) textbooks, school accessories, and goods for children (appendix 2).
G) raw materials, products, and equipment to produce aluminum.
H) commodities purchased on credits within interstate agreements.
I) equipment to be delivered due to contracts sighed before january 1, 1996.
J) equipment for research and goods brought in as contribution to the authorized fund of ventures with foreign capital within a year from the moment of customs registration.
K) special goods for invalids' rehabilitation.
L) agricultural products and raw materials of vegetation origin.

Further control of purposeful use of goods, relieved from VAT and special tax, is implemented by tax authorities at registration place of consignee.

6. Order and terms of payment
------------------------------
As confirm of payment of VAT, excise and special tax, due to a filled customs declaration, a payment order from a bank confirming the payment should be attached.

VAT, excise, and special tax are placed in the deposit account of customs. In case of non-receive of the means to the deposit account within two months from the date of the customs declaration's presentation, the customs authorizes the tax committee to recover a payment.

Due to a customs decision, a payee may be granted a two month delay from the date of a customs declaration. For a delay granted, an interest rate on the national bank rates is collected.

A payment delay is granted on the following:
A) by presentation of a letter of guarantee from an authorized bank.
B) by commodities' pledge in accordance with the corresponding legislation of Tajikistan.

In case a payee or authorized bank do not fulfil their obligations concerning a payment delay of VAT, excise, or special tax, the customs recovers outstanding sums and fine of 0.3 percent for each day of delay, including the day of recovering the fine.

7. Return of earlier paid VAT,
Excises, and special tax
-------------------------------
Customs return payments of VAT, excise, and special tax in the following case:
- wrong calculation of taxes and excises, including the correction of customs value.

The payee is entitled to demand for a return of earlier wrongly paid or recovered sums of excises or taxes, including those connected with correction of customs value.

Return of earlier paid of excises and taxes to tax authorities will be executed by these tax authorities after the customs' confirm.

8. Use of VAT, excise, and special tax
By different customs regimes
---------------------------------------
Release of goods from free circulation
-------------------------------------
commodities brought in for free circulation (import) are subject to VAT, excise, and special tax in the established order. When a customs order is changed, a tax mechanism valid on the date of change is imposed.

Commodities reimport
--------------------
Commodities produced and earlier exported from Tajikistan, are subject to VAT, excises, and special tax when reimported to Tajikistan.

Logistics items, equipment, fuel, food products, and other property belonging to Tajik juridical bodies and Tajik agencies necessary for their activities abroad, being reimported, are not subject to VAT, excises, and special tax.

Commodities in Transit
-------------------
Transit commodities are not subject to VAT, excises, and special tax.

Customs warehouses
------------------
When placed in customs warehouses, import commodities are not subject to VAT, excises, and special tax. The above mentioned taxes are collected at the moment of goods' release from warehouses into free circulation.

Responsible for payment of VAT, excises, and special tax is the owner of a warehouse or the body which has placed commodities in a warehouse.

Commodities shall be exported within three months from the date goods are placed in a warehouse.

Duty-free stores
----------------
In duty-free stores VAT, excises, and special tax are not collected. In cases of violations of a customs regime, the owner of a duty-free store is responsible for payment.

Processing goods inside customs territory
-----------------------------------------
Commodities which need to be processed within the customs territory are subject to payment as for free circulation.

Temporary export and import
---------------------------
When goods temporarily are brought in, excises and special tax are not collected from:
- vehicles for international cargo and passenger transportation, including containers.
- professional equipment and instruments belonging to foreign juridical bodies and individuals to perform works or services on the territory of Tajikistan.
- exhibit items
- equipment and materials for research and education purposes if such equipment and materials belong to foreign juridical bodies or individuals and their use is of non-commercial character.
- materials to liquidate nature disasters and accidents granted to state bodies for free.
- packaging
- goods samples if they are property of foreign juridical bodies or individuals and their use is of non-commercial character.

When goods are temporarily brought out, the relieve from taxes and excises and return of paid sums are not implemented.

Goods processing under customs control
--------------------------------------
If goods are brought in to be processed under customs control, VAT, excises, and special tax are not collected.

Free customs zones and free warehouses
--------------------------------------
If goods are brought in to free customs zones and are placed in free warehouses, VAT, excises, and special tax are not collected.

If goods are brought in from free customs zones and free warehouses to the other territory of Tajikistan, VAT, excises, and special tax are only collected if the country of goods origin is not Tajikistan.

If domestic goods for export are brought in to free customs zones and are placed in free warehouses, relieve or return of VAT, excises, and special tax are executed in the order for export goods. Actual export of such goods shall be performed not later than six months after return of paid sums or their relief. In case actual export is not performed within this period, taxes and excises are paid to tax authorities in the established order, including interest on the national bank rates.

Goods processing outside customs territory
------------------------------------------
When goods are brought out from the customs territory of Tajikistan for processing, VAT, excises, and special tax earlier paid to tax authorities are not subject to return.

When goods for processing are brought in, VAT, excises, and special tax are collected from processing value (difference between values of goods for processing brought in and out) on the rates for goods to be processed brought in.

Export of goods
---------------
When goods are exported by producers, such goods are relieved from VAT, excises, and special tax in the order established by the tax legislation of Tajikistan.

When goods are exported by other enterprises, the sum of paid VAT, excises, special tax are returned by tax authorities by a customs' confirmation after a year a payment was made to the budget in accordance with the tax legislation of Tajikistan.

Reexport of goods
-----------------
When goods are reexported to Tajikistan, VAT, excises, and special tax are not collected. Actual reexport of such goods shall be performed not later than six months from the date the customs declaration is accepted to be furnished.

When goods brought in are not declared for reexport or if they are not reexported for six months, such goods are subject to VAT, excises, special tax and interest on the national bank rate.

If reexported goods are brought out, earlier paid sums of VAT, excises, and special tax are subject to return on the following conditions:
- if reexported goods are in the same condition when they were brought in except for natural deterioration.
- actual reexport is performed within two years from the moment of bringing in.

Dispose or giving up for state
------------------------------
If goods are disposed or given up for state, VAT, excises, and special tax are not collected.

Use of VAT, excises, and special tax within cis
-----------------------------------------------
VAT, excises, and special tax are not collected from goods brought in and out Tajikistan from territories of cis countries.

Responsibility of payees and customs control
--------------------------------------------
All the responsibility for correctness and timeliness of VAT, excises, and special tax is born on the payee.

Payees are responsible for breach of this decree in accordance with the current customs and tax legislation.

Control for collecting of VAT, excises, and special tax is performed by the customs committee of the government of Tajikistan.

PART 2

EXCISE RATES
1. SUMMARY. POST SUBMITS THE NEW EXCISE RATES ON SELECTIVE COMMODITIES BROUGHT IN FROM OUTSIDE THE NIS AND LOCALLY PRODUCED COMMODITIES. THE NEW DUTIES ARE AIMED AT REDUCING THE BUDGET DEFICIT AND PROTECTING LOCAL PRODUCERS. ALL THE PREVIOUS TARIFFS SHALL BE CONSIDERED INVALID.
END SUMMARY.

2. Excises Rates on Goods Imported From Outside the NIS
----------------------------------------------------

GROUPS      SECTIONS AND GOODS     EXCISES RATES FROM
AND CODES                          CUSTOMS VALUE IN
                                   PERCENT IN USD
------------------------------------------------------
     1               2                    3
------------------------------------------------------

GROUP 22

220300      MALT BEER                     25

2204        NATURAL GRAPES WINES,
            INCLUDING FORTIFIED ONES;
            MUST                          100
220410110   CHAMPAGNE                     80

2203        VERMOUTHS AND OTHER
            NATURAL GRAPES WITH PLANT
            AND AROMATIC EXTRACTS         100

220600      APPLE CIDER, PEAR PARRY,
            HONEY BEVERAGE                100

2207        ETHYL ALCOHOL WITH ALCOHOL
            CONTENT NOT LESS THAN
            80 PERCENT; ETHYL ALCOHOL
            AND OTHER ALCOHOL OF ANY
            CONCENTRATION                 90

2208        ETHYL ALCOHOL WITH ALCOHOL
            CONTENT OF LESS THAN 80
            PERCENT, STRONG ALCOHOLIC
            DRINKS; LIQUEURS;  ALCOHOLIC
            SEMI-PRODUCTS                 85

            THE SAME IMPORTED BY
            ENTERPRISES-MANUFACTURERS
            WITH A LICENSE TO PRODUCE
            THESE PRODUCTS                50

220830      WHISKEY                       100

220840      RUM AND TAFFY                 80

220850      GIN AND GENEVA                80

220890310   VODKA                         200

220890330   PLUM, PEAR, OR CHERRY
            POTIONS, EXCLUDING LIQUEURS   100

220890510   OTHER ALCOHOL DRINKS AND
            LIQUEURS                      100

GROUP 24

24          TOBACCO AND ITS INDUSTRIAL
            SUBSTITUTES EXCLUDING
            2401:  RAW TOBACCO
            AND TOBACCO WASTE)            100

GROUP 27

2709        RAW OIL, RAW OIL PRODUCTS
            FROM BITUMINOUS LAYERS,
            INCLUDING GAS CONDENSATE      10
2710        OIL AND OIL PRODUCTS FROM
            BITUMINOUS LAYERS, EXCLUDING
            RAW;  PRODUCTS WITH OIL
            CONTENT OF AND 70 PERCENT
            FROM BITUMINOUS LAYERS         10

GROUP 40

4011        TIRES PNEUMATIC RUBBER NEW     50

GROUP 42

4203        CLOTHES AND CLOTHES PARTS
            FROM GENUINE OR MAN-MADE
            LEATHER                        35

GROUP 43

4303        FUR CLOTHES AND PARTS          35

GROUP 57

57          CARPETS AND OTHER TEXTILE
            CARPETING                      30

GROUP 65

6506        HATS WITH LINING OR WITHOUT,
            WITH TRIMMING OR WITHOUT       20

GROUP 70

7013        TABLE AND KITCHEN GLASS
            PRODUCTS; OFFICE AND HOME
            PRODUCTS                       20

GROUP 71

7113        JEWELRY AND PARTS FROM
            PRECIOUS STONES OR METALS
            INLAID WITH PRECIOUS STONES    40

7114        GOLD AND SILVER JEWELRY OR
            PARTS FROM PRECI
OUS STONES OR
            METALS INLAID WITH PRECIOUS
            STONES                         50

7116        JEWELRY FROM NATURAL OR
            ARTIFICIAL PEARLS, PRECIOUS OR
            SEMI-PRECIOUS STONES (NATURAL,
            ARTIFICIAL, OR RECONSTRUCTED)  50
5208-5212   COTTON FABRICS                 20
5007        FABRICS FROM SILK AND SILK
            WASTE                          20

GROUP 87

8703        CARS AND OTHER PASSENGER
            VEHICLES (EXCLUDING CARS FOR
            NOT LESS THAN TEN PASSENGERS
            AND A DRIVER), TRUCKS,
            AND RACE CARS                  40

3. Excises Rates on Commodities Produced in Tajikistan -------------------------------------------------------------------------

     GOODS                            EXCISES RATES
                                       IN PERCENT
                                       FROM RETAIL
                                         PRICES
----------------------------------------------------

1  DRINKABLE ALCOHOL (EXCEPT FOR
ENTERPRISES-MANUFACTURERS OF ALCOHOL
PRODUCTS WITH A LICENSE                     90
----------------------------------------------------
2  VODKA                                    80
------------------------------------------------.---
3  LIQUEUR-VODKA PRODUCTS                   80
----------------------------------------------------
4  WINE AND WINE RAW MATERIALS              40
----------------------------------------------------
5  COGNAC                                   60
----------------------------------------------------
6  CHAMPAGNE                               100
----------------------------------------------------
7  BEER                                     30
----------------------------------------------------
8  TOBACCO PRODUCTS
   LST CLASS CIGARETTES                     30
   2ND-3D CLASS CIGARETTES WITH FILTER      20
   OTHER KINDS OF CIGARETTES                10
----------------------------------------------------
9  JEWELRY (FROM PRECIOUS AND SEMI-PRECIOUS
   STONES                                   20
---------------------------.------------------------
10 FUR PRODUCTS (INCLUDING HATS, COLLARS,
   AND CUFFS)                               10
----------------------------------------------------
11 PORCELAIN PRODUCTS                       30
----------------------------------------------------
12 NATURAL LEATHER CLOTHES                  30
----------------------------------------------------
13 ESTHER OIL                               20
14 OIL (EXCEPT FOR USED TO PRODUCED OIL
   PRODUCTS)                                10
----------------------------------------------------
15 BENZIN, DIESEL, AND OTHER PRODUCTS AFTER
   OIL PROCESSING                           10
----------------------------------------------------
16 GAS (INCLUDING GAS CONDENSATE) FORM
GAS-FILLING STATIONS                        20
----------------------------------------------------