Enterprises with turnover of up to 1 billion soums to be considered as small business

In her opinion, the concept of improving tax policy is very important: for the first time in Uzbekistan, the government, ministries, departments and business - worked closely with the goal of creating this historic document. This concept envisages not only reforms in the economic sphere, but also in all directions, she added.

“During the preparation of the new draft of the tax system, the main emphasis was made on solving the issues of tax burden and the development of entrepreneurship. In the current concept, this issue is resolved,” Guzal Islamova said.

She noted that tax rates and definitions of small businesses are simplified. "Henceforth, the entrepruener with annual turnover of up to 1 billion soums will be considered as small business. As this is the business that feeds a small family, it provides accommodation and education for the younger generation. In addition, the figures of national art will represent this sector, "she stressed.

Islamova underlined that a 5 percent turnover tax was abolished, which was condemned by international and local experts. The taxes on profits and dividends have also been reduced. “By doing this, we let people know that you can make a profit from investment with minimal losses. This, in turn, contributes to the further development of the business ecosystem in the country,” Islamova said.

“Reducing the tax rate for dividends implies improvement of the investment climate and shows that the state is open to dialogue and is ready to provide comprehensive support to business development,” she stated.

“Concerning the taxes of individuals, the Concept establishes a single tax payment of 12%. The revolutionary step was the cancellation of social contributions, and the reduction of property rates. A fair approach has been introduced, the transition to which requires a certain amount of time. We must reconsider our vision and understand that taxes are being returned to us as government services in the form of beautiful cities, accessible education, modern bus stops and so on,” Guzal Islamova added.

She noted that all changes will be made to the Tax Code gradually. It should be taken into account that the first year of reforms is the most difficult.

“In the process of working with the Concept, there have been a lot of proposals, which are taken into account as much as possible in the final version of the document. The concept is a common idea that relates to the period of transformation. This is the first big step that requires consideration of all specific aspects of the system, which will be reflected in the Tax Code,” she said.

Islamova stated that the concept envisages improving the budget system, including strengthening the independence and stability of regional budget institutions.

"There is a reduction in the rates of banking activities, this in turn will expand credit opportunities. Moreover, a number of measures are planned for the recovery of companies that have suspended their activities for various reasons, "she added.

"When we talked about the Concept, we studied similar processes in Georgia. There were proposals to implement the Georgian system. In fact, what is stated in the Concept reflects a very balanced approach to the realities of our business, our economy. Therefore, it is difficult to compare us to those countries that quickly switched to a completely new system,” Islamova said.