Uzbekistan tax authority tightens control over businesses

Tashkent, Uzbekistan (UzDaily.com) — Uzbekistan is tightening control over business fragmentation practices in the catering sector. The issue was raised on 21 April by Chairman of the Tax Committee Farrukh Pulatov during an open dialogue with entrepreneurs in the gastronomy industry.

According to him, 419 catering establishments in Tashkent have been identified where, as alleged, individual entrepreneur registrations are used either on employees or on the business founder, with cash register receipts issued under their names.

Tax authorities assess this practice as a method of concealing actual turnover and reducing tax liabilities, including value-added tax obligations.

Farrukh Pulatov emphasized that such schemes are known to regulatory bodies and are classified as business fragmentation.

“We see and know all of this. Instead of recording expenses through their own enterprise, they simply issue receipts through another individual entrepreneur. This is business fragmentation to avoid paying VAT. Please do not do this. We see it everywhere. When inspections come, do not be offended. Please work legally,” he stated.

He added that the absence of fiscal receipts and the use of third-party individual entrepreneurs are considered indicators of concealed revenue. According to him, tax authorities have been instructed to begin with warnings, but repeated violations will result in fines.

“If they do not comply, there will be significant fines,” he said.

Chairman of the Chamber of Commerce and Industry Davron Vakhabov proposed providing a list of the 419 identified establishments to conduct preventive outreach with entrepreneurs. Deputy Chairman of the Tax Committee Jakhongir Abdiyev confirmed that the list would be shared.

It was also noted that some participating entrepreneurs may underreport official wages and employee numbers. Tax officials stated that such cases are under review and will be included in further inspection and clarification efforts.