Central Asia tax & payroll news

Kazakhstan

• The MCI has been increased from 3,692 tenge (~6.80 eur) to 3,932 tenge (7.24 eur). Fines, taxes, social payments and other payments that are calculated based on the MCI will increase by an average of 6.5%.
• Until 2025, there was only one situation when it was allowed to make changes to the Tax Code during the year that worsened the situation of taxpayers. This exception concerned the taxation of remuneration for securities. Since 2025, the corresponding clause has been excluded from Article 3 of the Tax Code of the Republic of Kazakhstan.
• Banks and organisations carrying out certain types of banking operations, when identifying operations that have signs of receiving income from entrepreneurial activity, were required to provide information on the operations of:
      - employees of state institutions and their spouses,
      - participants/founders of companies and their spouses.
     From 2025, banks and organisations carrying out certain types of banking operations are required to provide information when identifying operations that have signs of receiving income from entrepreneurial activity for all persons who are not registered as:
      - individual entrepreneurs or
      - persons engaged in private practice.
  A person engaged in private practice is now required to maintain records in certain forms of accounting registers.

CIT

• R&D expenses could be deducted on the basis of:
      - the completed R&D task and
      - acceptance certificates for completed stages of such work.
      From 2025, R&D expenses can be deducted on the basis of:
      - notification of the authorised body in the field of R&D in accordance with the legislation of the Republic of Kazakhstan on science and technology policy
      - for expenses on the acquisition of R&D
      - actually completed technical assignment and
      - acts of acceptance of completed stages of such work.
• The taxpayer has the right to reduce taxable income by the following types of expenses:
      - in the amount of 50% of the amount of R&D costs,
      - acquisition of exclusive rights to intellectual property from higher and (or) postgraduate education organisations, scientific organisations and start-up companies under a license agreement or an agreement to assign exclusive rights for the purpose of commercialising the results of scientific and (or) scientific and technical activities.
   
• A 100% tax benefit is provided to the income of subjects of scientific and (or) scientific and technical activities accredited by the authorised body in the field of science, in the form of funding for the creation of scientific centers at research universities.

Personal income tax and social contributions general changes            
The rates for 2024 - 2025 have been revised as follows:        

- Social contributions from 3.50% to 5%. From 2025, under civil-law contracts, the tax agent must pay social contributions.        

- Social tax from 9.50% to11%.

- Mandatory employer pension contributions from 1.50% to 2.50%. 

• Individual entrepreneurs applying a special tax regime for producers of agricultural products, aquaculture products (fish farming) and agricultural cooperatives calculate the individual income tax taking into account the features established by Chapter 78. Special tax regimes for producers of agricultural products.        

The list of incomes that are not considered as income of an individual has been supplemented with:        
    - the cost of uniforms issued to an employee in cases where the legislation of the Republic of Kazakhstan establishes an obligation to wear uniforms and (or) provide them,        
    - income received by the borrower as a result of payment for such person by a second-tier bank, an organisation carrying out certain types of banking operations, as well as a collection agency of the state fee collected from the statement of claim submitted to the court;        
    - income upon termination of obligations in accordance with the civil legislation of the Republic of Kazakhstan on a loan (credit, mortgage loan, mortgage housing loan, microcredit), including on the principal debt, remuneration, commission and penalty (fines), in the following cases that occurred after the issuance of a loan (loan, mortgage loan, mortgage housing loan, microcredit) to such person:        

• recognition of an individual - borrower as missing, incapacitated, partially incapacitated on the basis of a court decision that has entered into legal force, or declaration of him / her as deceased on the basis of a court decision that has entered into legal force;        
• establishment of a disability of the first or second group for an individual - borrower, as well as in the event of the death of an individual - borrower;        
• absence of other income of an individual - borrower receiving social payments in accordance with the Social Code of the Republic of Kazakhstan in cases of loss of a breadwinner, income in connection with pregnancy and childbirth, adoption of a newborn child (children), care of a child upon reaching the age of one year, except for the specified payments;        
• entry into force of the ruling of the bailiff on the return of the writ of execution to the bank (microfinance organisation, mortgage organisation) in the event that the individual - borrower and third parties jointly or subsidiary liable with the individual - borrower to the bank (microfinance organisation, mortgage organisation) do not have property, including money, securities, or income that can be recovered, and measures to identify his property or income taken by the bailiff in accordance with the legislation of the Republic of Kazakhstan on enforcement proceedings and the status of bailiffs were unsuccessful;        
• sale of the mortgaged property, which fully secured the principal obligation on the date of conclusion of the mortgage agreement, by auction out of court at a price lower than the amount of the principal obligation or transfer of such property to the ownership of the mortgagee in accordance with the Law of the Republic of Kazakhstan "On Mortgage of Real Estate" for the amount of the outstanding loan (mortgage loan, mortgage housing loan, microloan) after the sale of the mortgaged property.

Kyrgyzstan

   
Primary accounting document
For the convenience of taxpayers, the primary accounting document form BLANK STI-109 has been introduced on the website esf.salyk.kg. It is used when receiving advance payments for taxable supplies, writing off bad debts and canceling VAT registration.
Payment of taxes
    The State Tax Service of the Kyrgyz Republic has improved the process of transferring paid taxes and insurance premiums to the state budget. Now taxes and insurance premiums paid through the Taxpayer's Account, online banking or payment terminals are credited to the country's budget within half an hour.

Replacement of the portal for registration of foreign citizens

• From December 25, 2024, the Ework.e-gov.kg portal will stop accepting applications for quotas and work permits. Applicants for foreign labor are advised to complete all necessary documents before this date.
• By the Decree of the President of the Kyrgyz Republic "On measures to optimize migration processes in the Kyrgyz Republic" dated September 19, 2024 No. 268, the Resolution of the Cabinet of Ministers of the Kyrgyz Republic "On issues of regulating labor migration of foreign citizens and stateless persons in the Kyrgyz Republic" dated December 2, 2024 No. 721, the Temporary Regulation on the procedure for issuing permits for stay and work in the territory of the Kyrgyz Republic by foreign citizens and stateless persons was approved. From January 1, 2025, new rules for issuing permits for foreign citizens come into force in Kyrgyzstan. The procedure will be carried out on the principle of "Single Window" through the electronic portal Evisa.e-gov.kg.

Fuel tax
President of the Kyrgyz Republic Sadyr Japarov signed the Law of the Kyrgyz Republic "On Amendments to Certain Legislative Acts of the Kyrgyz Republic (to the Code of the Kyrgyz Republic on Non-Tax Revenues, to the Law of the Kyrgyz Republic "On the Road Fund")" dated November 20, 2024, according to which, from January 1, 2025, a fee of 1 som will be levied on each liter of fuel and lubricants. Importers and manufacturers of fuel and lubricants are required to pay fees.

Marking of fuels and lubricants

• According to the Resolution of the Cabinet of Ministers of the Kyrgyz Republic dated July 4, 2024 No. 361 "On the introduction of fuel labeling", from October 1, 2024, mandatory labeling of gasoline and diesel fuel, both imported and produced, using molecular markers was introduced in Kyrgyzstan;
• Entities involved in the circulation of petroleum products must label the residues of these types of fuel by December 31, 2024. The molecular marker is a unique compound built into the structure of gasoline that cannot be washed off. The marker is checked using special certified equipment;
• From January 1, 2025, the circulation of unmarked fuel is prohibited.

The following changes to the Tax Code came into force on January 1, 2025:

• Cancellation of VAT exemption on imported raw materials. VAT exemption will not apply to imported raw materials intended for the production of vegetable oil, poultry and fish feed.
• Excise tax rates on tobacco products . From January 1, 2025, excise tax rates on tobacco products increased.

Income tax and social security    
The average monthly salary for calculating income tax and insurance premiums for 2025 in Bishkek has been set at 37,455 soms (~ 400 eur).
 

Uzbekistan

Cancellation of VAT exemptions

The exemption has been cancelled for passenger transportation services at uniform rates:

• by urban passenger transport and public passenger automobile transport (except for taxis, including route taxis) at rates established by local government bodies;
• by suburban rail transport.

VAT exemption introduced for sale of state property
Added exemption of turnover for the sale of state property, including vacant non-agricultural land plots on the basis of ownership.
    
The VAT exemption has been clarified until 2028 for projects financed by public external debt attracted and being attracted from international financial institutions and foreign government financial organisations by budgetary organisations, as well as state enterprises and legal entities with a state share in the authorised capital for infrastructure projects
    Added specification of infrastructure projects:

• electricity, gas and heat supply
• water supply and sewerage
• water management
• road and transport infrastructure
• communications and telecommunications
• agrologistics
• sanitary cleaning
• solid waste management

It is additionally stated that the benefit also applies to project participants.

VAT exemption for the lease of railway cars
For the period from November 1, 2024, to January 1, 2026, the turnover of wagon (container) operators who are residents of the Republic of Uzbekistan, for the provision of services for the use of wagons (containers) on the basis of a lease agreement in the transportation process on rail transport, is exempt from value added tax.
    
Excise tax   
Legal entities of the Republic of Uzbekistan providing mobile telecommunications services (excisable services) are excluded from taxpayers.
The provision of excisable services is excluded from the object of taxation.
Rates updated in art. 289.    
    
Income tax
New rates for income tax

• The rate has been increased from 7.5% to 10% for companies engaged in electronic trading of goods (works, services).
• The 0% rate on profits from the sale of goods (services) for export has been cancelled.
• 0% rate is introduced for profits received from the sale of electric energy to the general grid using renewable energy installations with a total capacity of up to 100 kW.  In this case, the 0% rate applies for 3 years from the month of commissioning of renewable energy installations, and when installing solar panels with an electric energy storage system with a capacity of at least 25% of the capacity of the solar panels, for 10 years from the month of commissioning of these panels.

The following tax benefits were introduced:

• Benefit for publishing and printing activities
• Tax benefit on income received from the provision of services in the field of information technology to residents of the Technological Park of -Software Products and Information Technology
• Dividend tax break for residents of the Technological Park of Software Products and Information Technologies 
• Benefits for residents of the Technological Park of Software Products and Information Technologies
• Benefits for kindergartens and schools