In case of contracting businesses of foreign entities in Iran with regard to all types of work in fields of construction, installations, and technical installation including procurement and setting up of the same or transportation, preparation of design for buildings and installation, topography, supervision and technical calculations, provision of training and technical assistance, transfer of technology and other services, the taxable income will be 12% of total annual receipts. (Para“a”, Article 107, Iranian Tax Code). In the event the relevant employer of the contract is a ministry, a government institution, a state company or a municipality, then that part of the contract price which is used for purchase of supplies and equipments from domestic or foreign sources shall be exempt from taxation, provided that the amounts relevant to those supplies and equipments are included, apart from other items, in the contract or in its further amendments or supplements. (Note 2, Article 107, Iranian Tax Code). However, in accordance with Note 5 of Article 107 of Iranian Tax Code, the taxable income of the activities subject matter of Para“a” of Article 107 thereof, the contracts which will be concluded from the beginning of the year 2003 onwards, shall be audited according to the provisions of Article 106, by way examination of statutory books.