As part of the implementation of the instructions of the Head of State Kassym-Jomart Tokayev on the modernization of the national economic model, the Government is taking measures to ensure macroeconomic stability, improve the business climate, and attract investment. Particular attention is paid to launching a new investment cycle, creating a fair competitive environment, and building a predictable tax and budget policy.

Today, economic growth is supported by the dynamic development of the real sector, diversification of production, and strengthening of transport potential. The state systematically fulfills social obligations to increase payments, expands sports infrastructure in the regions, and creates conditions for guaranteed sales of products of domestic enterprises through mechanisms of long-term contracts.

Based on the results of the first 6 months of 2026, this work has shown a steady result. The main driver of macroeconomic stability was investment in fixed capital, the volume of which exceeded 9.5 trillion tenge, while private investments showed an outpacing growth of 21.4%.

A significant contribution to growth comes from the reduction of administrative pressure on business, a threefold reduction in the terms of public procurement, and the introduction of digitalization. At the same time, the implementation of the new Tax and Budget Codes has been launched in Kazakhstan, which are designed to create more favorable conditions for the real sector and strengthen control over the expenditure of public funds.

What systemic reforms are behind these indicators and how government support measures are changing the conditions for doing business in Kazakhstan – read in the review by the editorial office of the Primeminister.kz website.

Kazakhstan’s Economy Accelerates: What Ensures GDP Growth of 4.1%?

In the first half of the current year, Kazakhstan’s GDP showed growth of 4.1% due to the sustainable development of the non-oil sector. Production of goods in the real sector increased by 5.1%, and the services sector added 3.5%.

In terms of industries, the construction sector firmly holds the leading position in terms of growth rates, with indicators increasing by 15.2% at once. Good dynamics are shown by manufacturing industry – growth of 9.8%, as well as the sphere of transport services – 7.1%. Positive statistics remain in trade (+5.7%), communications services (+4.3%), and agriculture (+4.4%). The combined contribution of these four key industries provides about 85% of the entire GDP growth of the republic.

Positive dynamics are also noted in the social sector: after last year’s decline, real incomes of the population in the first quarter increased by 0.1%. Stabilization was facilitated by a slowdown in annual inflation in June to 10.3%. To consolidate the trend, a Comprehensive Plan to Increase Incomes has been adopted, focused on creating high-productivity jobs.

The main driver pushing economic indicators forward is investment activity. The total volume of capital investments in the first half of the year grew by 9.6%, and the share of private capital in the structure of investments reached 87%. The information and communications sector is currently experiencing a qualitative investment boom, where the volume of attracted funds increased 2.3 times. High investor interest has also been recorded in the construction sector (+38.7%), manufacturing industry (+33.3%), agriculture (+24.6%), and transport sector (+11.6%).

High indicators are also demonstrated by the domestic trade sector: in the first half of the year, its volume increased by 15.3%, reaching 36.2 trillion tenge. Wholesale trade grew by 6.6%, retail trade – by 3.8%. The positive trend is supported by the foreign trade direction: for January-May, the republic’s trade turnover amounted to $56.3 billion, and imports amounted to $26 billion, which allowed maintaining a confident positive trade balance of more than $4.4 billion. At the same time, by the end of the half-year, a qualitative growth of non-resource exports of goods and services was recorded – by 14.6%, to $14.9 billion (including exports of processed goods increased by 14.5% – to $11.8 billion, exports of services – by 14.8%, to $3.1 billion).

Freedom Instead of Inspections: How State Control Reform and New Guarantees Have Given a Second Wind to SMEs

In parallel with the growth of large industries, small and medium-sized businesses are consistently strengthening their positions in the country. According to the Committee of State Revenues for the first half of the year, the total number of registered business entities in Kazakhstan reached 2.9 million, which is 499 thousand or 20.4% more than at the beginning of 2026. In the sectoral context, a qualitative redistribution of resources to productive sectors is recorded: an increase in the number of small legal entities in mining (+2.9%), construction and agriculture (+2.5%), information and communications (+2.4%). At the same time, the share of small and medium-sized enterprises in the country’s GDP reached 40.9% by the end of 2025, and the output of products amounted to 104.7 trillion tenge, which is 27.8% more than the indicators of the same period last year.

This business activity is largely due to the systematic work of the Government to reduce administrative burden. The state has radically changed its approach to control, moving from punitive measures to prevention. As a result, according to the General Prosecutor’s Office, the number of business inspections decreased by 8.6% last year. More than 10 thousand excessive requirements have already been excluded from the laws, and to prevent new pressure, the strict principle “1 in 2 out” is applied, prohibiting the introduction of one new norm without canceling two existing ones. To date, 49% of business reporting has been optimized, and a convenient digital application “eGov Business” has been launched for operational interaction between SMEs and the state.

In addition, the state is strengthening financial support for entrepreneurs. Last year, preferential financing covered about 9.5 thousand projects in the amount of 1.6 trillion tenge. New instruments are actively being used today: under the “Örleu” program, entrepreneurs are provided with large loans at 12.6% for up to 10 years (as of June 1, 91 borrowers were supported for 18.4 billion tenge), and in the regions the “Isker Aimaq” program has been launched with a rate of 13.2% for manufacturing industry projects.

To expand business access to borrowed funds and reduce dependence on budget financing, two new guarantee funds were created on the basis of the “Damu” fund. Their priority areas are manufacturing industry, transport, logistics, and education. This mechanism has allowed actively involving commercial banks’ funds in business lending. As of June 1 of this year, within the framework of Guarantee Fund-1, support was received by 1,305 projects in the amount of 248.1 billion tenge (of which issued guarantees amounted to 125.5 billion tenge), and for Guarantee Fund-2, 8 large projects were approved in the amount of 456.3 billion tenge (the amount of issued guarantees was 99.1 billion tenge). The entire process of monitoring the effectiveness of the distribution of these funds is fully automated in the digital system “Baqylauda”.

The logical continuation of the policy of protecting honest business was the radical modernization of the public procurement system. Thanks to the new law, the overall terms of procedures have been reduced threefold – from 30 to 10 working days, and the share of non-competitive procurements from a single source has decreased to 23%. To comprehensively support Kazakhstani producers, a mandatory advance payment of 50%, exemption from all types of contract security, and a reduction of the penalty to 3% have been introduced. This system is already bearing fruit: in six months, the volume of public procurement amounted to 7.7 trillion tenge, while 61,532 contracts were concluded with domestic producers in the amount of 85.2 billion tenge.

Kazakhstan Has Accumulated 89% of Greenfield Projects in Central Asia

It is important to note that the reforms being implemented by the Government directly contribute to the implementation of the task set by the President – to double the country’s GDP to $450 billion by 2029 and ensure an inflow of foreign capital of at least $150 billion. To ensure that foreign companies willingly invest in our country, an Investment Headquarters has been launched, which resolves any issues of investors on the spot and in real time. For large projects worth over $60 million, the Investment Agreement instrument is provided, guaranteeing the stability of the legislation of the republic for 25 years. To date, 62 such agreements have been concluded.

Thanks to a systematic approach, Kazakhstan confidently maintains its status as the leading investment destination in the region. According to UN ESCAP data, last year the republic attracted $19 billion in greenfield projects, which amounted to 89% of all intra-regional investments in new production in Central Asia. The total inflow of foreign direct investment grew by 14.4% and amounted to $20.5 billion. In the structure of FDI, trade ($4.8 billion), manufacturing industry ($4.4 billion), and the mining sector ($3.4 billion) lead. The top 5 key investors today include the Netherlands ($4.6 billion), Russia ($2.9 billion), China ($2.8 billion), the UAE ($1.6 billion), and Singapore ($1.4 billion), whose investments are directed toward the implementation of technologically complex industrial and infrastructure projects.

What Changes Does the New Tax Code Bring and How Does It Protect the Interests of Citizens?

The most important step towards creating a transparent and sustainable economic ecosystem was the entry into force of the new Tax and Budget Codes. The new tax policy is focused on comprehensive support for the real sector and a fair distribution of the burden.

The reform is already bringing serious macroeconomic results: in the first half of the year, state budget revenues increased by almost 16% compared to the same period last year. A separate fiscal driver was VAT receipts, which increased almost 1.5 times, strengthening the country’s revenue base.

The effectiveness of tax transformations is also confirmed by the execution of the republican budget for the first half of the year: its revenues excluding transfers reached 8.5 trillion tenge – 100.6% of the plan, having increased by 24.6% or 1.7 trillion tenge compared to last year. An important result of bringing business out of the shadows was an increase in the number of VAT payers by 22.3 thousand – to 158.2 thousand entities. To consolidate this trend, a Comprehensive Plan to Counter the Shadow Economy for 2026–2028 has been approved.

At the same time, the basic CIT rate has been maintained at 20%, but for banking activities it has been increased to 25%, and for agricultural producers, on the contrary, it has been set at a preferential level of 3%. The basic VAT rate has been fixed at 16%, while reduced rates have been introduced for medicines, educational literature, and the press. The threshold for mandatory VAT registration has been changed to 10 thousand MCI.

As part of the PIT reform, a progressive scale has been introduced – the so-called tax on super incomes. Now citizens with high earnings will pay an increased rate of 15%, but only on the amount that exceeds 8.5 thousand MCI or 36.7 million tenge per year. For ordinary salaries, the tax rate remained the same. At the same time, pension payments from the UAPF are now fully exempt from PIT. Along with this, the transport tax for passenger cars with an operating life of more than 10 and 20 years has been reduced by 30% and 50%, and the amount of the social deduction for persons with disabilities of the first and second groups has been increased to 5 thousand MCI. The administration system itself is transitioning to a service model: the total number of taxes and fees has been reduced by 20%, and the forms of reporting – by 30%. To coordinate the reform, 239 normative acts have been adopted and the infrastructure of the Project Office has been deployed.

#Economy #Finance #Income growth #Industry #Tax Policy #Trade

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