The first public clarification of Kazakhstan’s new Tax Code took place at the site of the Atameken National Chamber of Entrepreneurs. Deputy Prime Minister – Minister of National Economy Serik Zhumangarin and Chairman of the Presidium of the Chamber Raimbek Batalov held a hybrid-format seminar-meeting with representatives of industry associations. During the meeting, government officials explained to businesses the key provisions of the new Tax Code.

Participants included representatives from the machinery, pharmaceutical, food service, retail trade, healthcare sectors, tax consultants, and other professional associations.

In addition to highlighting the main changes in the new document, particular emphasis was placed on special tax regimes and new approaches to tax administration.

Yerlan Sagnaev, Director of the Department of Tax and Customs Policy at the Ministry of National Economy, noted that the number of special tax regimes (STRs) in the new Code has been reduced from seven to three:

• for self-employed individuals,

• based on a simplified declaration,

• for peasant or farm households.

"The special tax regime for self-employed individuals may be used by persons who are not registered as individual entrepreneurs, do not employ workers, and do not engage in activities that disqualify them from this regime. Their monthly income must also not exceed 300 MCI," Yerlan Sagnaev said Yerlan Sagnaev.

These self-employed individuals are exempt from individual income tax (IIT) and are only required to make social contributions for themselves at a rate of 4% of their income.

The new simplified declaration regime retains the exemption from VAT and social tax. It can be used by taxpayers whose annual income does not exceed 600,000 MCI (2.4 billion tenge), with no restriction on the number of employees, provided their activity is not on the list of prohibited types.

The current STR for peasant (farm) households has been preserved.

"The only change is due to the abolishment of the unified land tax. The applicable 0.5% income tax from gross income will now be paid as IIT to the relevant budget classification code, as with other entrepreneurs. Additionally, for agricultural land not used for its intended purpose or used in violation of Kazakh legislation, the base land tax rates (land use fees) will be increased by 20 to 40 times," Sagnaev added.

The new Tax Code provides for comprehensive simplification of tax administration:

• 30% reduction in reporting, 20% fewer taxes,

• optimization of tax benefits and fees,

• new approaches to tax administration.

“Approaches to tax administration will change. Currently, all enforcement measures for tax debt begin at the threshold of 6 MCI. In the new Code, measures will depend on the size of the debt. Business operations will no longer be blocked for minor debts. If the amount is up to 20 MCI, only a notice will be sent. If it is between 20 and 45 MCI, an official notification will be issued, and in the event of non-payment, spending transactions on bank accounts will be suspended, and collection orders will be initiated. If the debt exceeds 45 MCI, the debtor’s assets will be described for auction and work will begin to recover the debt from the debtor’s accounts receivable,” Sagnaev concluded.

Veronika Daugalieva, head of the self-regulatory organization for public catering, proposed retaining the ability to deduct expenses incurred by entrepreneurs operating under the simplified declaration regime from corporate income tax. Viktor Mikryukov, Executive Director of the Association of Developers of Kazakhstan, voiced concerns over the practice of retroactively invalidating legal entity registrations and advocated for a proper procedure for compulsory liquidation. Other participants raised many questions and received detailed answers from government officials.

Further explanatory work on the provisions of the new Tax Code will now continue in other regions.

#Serik Zhumangarin #Tax Policy

• 
• 
• 
•