Uzbekistan Introduces Tax Incentives for AI and Data Center Projects

Tashkent, Uzbekistan (UzDaily.com) — Uzbekistan is introducing tax incentives for large-scale artificial intelligence and data center projects valued at over US$100 million.

The President of Uzbekistan has approved a package of investment incentives for foreign companies implementing AI infrastructure and data processing center projects in the Republic of Karakalpakstan.

Investors whose projects exceed US$100 million will be exempt from customs duties and value-added tax (VAT) on imported servers, graphics processing units (GPUs), and cooling systems that are not produced domestically.

Companies registered as residents of the national IT park, including exporters of cloud and AI services, will receive exemptions from profit, property, and land taxes until 2040, as well as a zero percent dividend tax rate for foreign shareholders.

A fixed electricity tariff of US$0.05 per kWh (excluding VAT) has been set for project facilities. Operators are required to reduce power consumption by 20% during peak load hours and to implement battery energy storage systems (BESS) capable of providing 30–35% of capacity to help stabilize the grid.

The government will provide external infrastructure for the projects, provided that investors contribute at least 25% of their own funds. They will also be allowed to make direct international payments to foreign contractors and suppliers without routing transactions through local banks. Construction will follow the Design–Procure–Build model, enabling simultaneous implementation of all stages. Land for such projects will be allocated directly by the Cabinet of Ministers of Karakalpakstan.

Minister of Digital Technologies Sherzod Shermatov emphasized that the new sites will become major hubs for AI development, hosting startups and data centers equipped with GPUs. Their location also aligns with plans to expand renewable energy generation in the region.

According to government plans, Uzbekistan aims to attract over US$1 billion in foreign investment into AI and digital infrastructure development by 2030.