The price of consumer goods is formed mainly on the basis of net cost. Net cost means commercial expenses: price of raw materials, supplies, salaries, overhead expenses, taxes and charges, amortization and other manufacturer’s expenses.

Secondly, the price of goods contains the profit of manufacturer. The sum of net cost and profit makes us release price at which manufacturer sells the goods to trade companies. Both wholesale and retail dealers add the markup to the price of goods. Furthermore retail price of all the goods includes the Value Added Tax (VAT).

Manufacturer
_NET_COST_ profit Release
price
Trade
markup
VAT
Retail
price
  

At the moment there is governmental regulation of prices and rates on some goods, works and services in Belarus. The list of these goods has been approved by Decree of the President* in February 2011, you may find out more about it in section « Who are the price-regulators?».

The rest of goods, works and services are free to be established by manufacturers and sellers.

It is necessary to admit that transition to market mechanism of pricing and non-interference of government in this process are stated by the Directive №4**




*The Decree of the President of the Republic of Belarus of 25.02.11 №72 «On some issues relating to regulation of prices (rates)»
** The Directive of the President of the Republic of Belarus of 31.12.10 №4 “On the development entrepreneurial initiative and stimulating business activity in the Republic of Belarus”