Namangan Launches Pilot Project for New Tax Administration Model

Tashkent, Uzbekistan (UzDaily.com) — A pilot project aimed at enhancing the efficiency of tax administration, reducing arrears on property and land taxes, and strengthening the revenue base of local budgets is being launched in Namangan Region.

At the same time, the region’s system of key performance indicators (KPIs) for tax authorities will be updated.

The pilot is being implemented as part of the next stage of reforms under the Presidential Decree “On Measures to Improve Tax Collection and Encourage Active Taxpayers” and will take effect on January 1, 2026. Its primary goal is to achieve a sharp reduction in arrears and improve compliance with timely tax payments.

As of 12 July 2025, there were 369,000 individuals in Namangan Region with outstanding property and land taxes. Of these, 43,400 people — or 12% — have arrears exceeding 1 million soums.

Enhancing the KPI System in Tax Authorities

Under the pilot, the system for evaluating the performance of territorial tax authorities will be modernized. Key performance indicators will be generated automatically, without human intervention, which will increase the objectivity of assessments and the transparency of tax administration.

By October 1, 2026, the results of the experiment will be analyzed, after which proposals will be submitted to the Cabinet of Ministers on expanding successful mechanisms to other regions of the country.

Rental Income Taxes to Benefit Local Budgets

Starting January 1, 2026, a new rule will take effect: personal income tax from rental property income will be fully allocated to the budget of the district or city where the property is located.

According to 2025 data, among 496,000 taxpayers renting out property in Namangan Region:

461,500 people (93%) are taxpayers in the same district as the property;

27,700 people (5.6%) belong to other districts of the region;

6,800 people (1.4%) belong to other regions.

It is expected that the new system will bring an additional 27.5 billion soums to district budgets and another 11.3 billion soums to the regional budget. These funds will enhance the financial capacity of local territories and improve the targeted use of budget resources.

Conclusion

The project launched in Namangan will be an important step in modernizing tax administration, strengthening payment discipline, and increasing the resilience of local budgets. Based on the results of the pilot, the possibility of expanding the new model nationwide will be considered.