Uzbekistan to impose three-year moratorium on small business checks

Tashkent, Uzbekistan (UzDaily.uz) —Uzbekistan will introduce a three-year moratorium on inspections of small businesses unless they are related to risks of harm to people's health or the interests of other entrepreneurs, President Shavkat Mirziyoyev said on 18 August at an open dialogue with entrepreneurs in Khorezm Region.

According to the president, the moratorium is aimed at reducing administrative pressure on businesses.

Mirziyoyev said that bringing the economy out of the shadow sector should not be achieved by increasing the number of inspections, but by supporting businesses and explaining the proper procedures for operating.

The president said that Uzbekistan's tax burden had declined from 13.4% to 12% over the past three years, while the share of the shadow economy had fallen from 50% to 26% over the past decade.

At the same time, an analysis of 5,000 entrepreneurs found that more than half had undergone tax inspections two or three times during the year. Another 21% of entrepreneurs had been inspected four times. Businesses had also been subject to repeated inspections by fire, construction, sanitary, quarantine and energy authorities.

“Bringing the economy out of the shadow sector should be achieved not through inspections, but by supporting entrepreneurs and explaining the proper procedures for operating,” Mirziyoyev said.

The president announced that the moratorium on all inspections of small businesses would apply for three years, except in cases involving possible harm to people's health or the interests of other entrepreneurs.

Separate changes will apply to medium-sized and large businesses. If a company voluntarily conducts a preventive audit, its findings will be recognized by tax authorities.

An entrepreneur who addresses deficiencies identified during such an audit will not be fined. A repeat inspection of the company within one year will only be possible with the permission of the Business Ombudsman.

“An entrepreneur who has eliminated the identified deficiencies will not be fined, while a repeat inspection within one year will only be possible with the permission of the Business Ombudsman,” the president said.