Tashkent, Uzbekistan (UzDaily.uz) — Uzbekistan plans to gradually phase out existing social tax benefits by 2030, Deputy Economy and Finance Minister Otabek Fazilkarimov said on 25 September at a press conference dedicated to discussing the pension reform draft.
According to the deputy minister, the benefits were introduced to support certain sectors based on various government decisions. An inventory found that the latest of the existing benefits is due to expire in 2030. Therefore, the phase-out is expected to be completed by that date.
At the same time, benefits will be discontinued as their established validity periods expire. If a particular benefit is valid until 2027, it will be abolished from that year in accordance with current legislation, Fazilkarimov clarified.
More than 65,000 enterprises have used social tax benefits. The total amount of support provided reached 3.2 trillion soums.
The deputy head of the Ministry of Economy and Finance highlighted the importance of the social tax in generating revenue for the Pension Fund. According to him, the fund’s deficit stands at 26%, with the gap between its revenues and expenditures covered by transfers from the state budget.
In July, the Institute of Fiscal Analysis under the Ministry of Economy and Finance proposed reviewing the existing 1% social tax benefit. According to the institute, around 30% of companies that were still operating at the time used the benefit in 2022–2024.
The distribution of support among enterprises was uneven. The largest 10% of companies accounted for 80% of the total amount of benefits, while the remaining 90% of enterprises received 20%.
The benefit was introduced to encourage businesses to move out of the informal economy and create new jobs.
At the same time, according to the Institute of Fiscal Analysis, the main recipients of the support were large employers that were already operating legally.
