Changes in the tax system

President Shavkat Mirziyoyev signed a decree “On measures to further streamline the provision of tax and customs benefits” with a view to further improving the country’s investment climate, ensuring the implementation of fair competition principles and streamlining the practice of granting tax and customs benefits

So, from August 1, 2019, an order is established according to which:

  • agricultural producers who are payers of the single land tax have the right to switch to payment of value added tax on a voluntary basis;
  • individual entrepreneurs who provide intermediary services to operators and (or) telecommunications providers whose revenues from the sale of services exceeded 100 million soums in a calendar year, but not more than one billion soums, are transferred to the payment of a single tax payment at a rate of 25 percent of the amount of remuneration.
  • the amount of wages and other incomes of individuals that are used to pay insurance premiums paid to legal entities licensed to carry out insurance activities in the Republic of Uzbekistan for long-term life insurance are not subject to taxation.

Also from October 1, 2019:

  • legal entities selling to the final consumers of gasoline, diesel fuel and gas through gas stations are recognized as value added tax payers regardless of the amount of revenue from the sale of these goods;
  • business entities – importers of goods are recognized as payers of value added tax, regardless of the amount of revenue from the sale of goods (works, services). At the same time, business entities importing goods for the first time are required to register as payers of value-added tax from the 1st of the month following the month the import contract is concluded;
  • exemptions on value added tax, including upon import, are abolished in respect of: asbestos, coal, timber, wood and wood products, hydrocarbons, soybeans, sunflower seeds and sesame, oilseeds and raw sugar, agricultural machinery; motor vehicles, components, materials and technological equipment used in the manufacture of motor vehicles;
  • VAT exemptions for agricultural products of own production and food products produced in the Republic of Uzbekistan are abolished. Also, single land tax payers with a turnover (revenue) of more than 1 billion soums for the period from January to September 2019 or irrigated agricultural land covering more than 50 hectares are payers of value added tax;
  • privileges for exemption from corporate income tax at the source of payment received as a percentage of funds placed in commercial banks are canceled.