Kazakhstan is preparing a major tax reform aimed at creating a fairer taxation system and reducing dependence on the National Fund. Prime Minister Olzhas Bektenov held a meeting with experts and business representatives, where key changes were presented and mechanisms for their implementation were discussed.
The need for reform is driven by Kazakhstan's significant lag in tax revenues compared to other countries. While in Russia the share of tax revenues in the gross domestic product (GDP) is 42%, and in developed countries it exceeds 50%, in Kazakhstan this figure stands at around 20%. According to forecasts from the Ministry of National Economy, without reforms the National Fund by 2035-2036 will be depleted to a minimum.
The government is banking on the digitalisation of tax administration. A big data analysis system has already been created within the Ministry of Finance, integrating 55 state databases, and by the end of the year this number will increase to 100. Digital profiles have been created for 569,000 legal entities and over 1.8 million individual entrepreneurs. This system allows for obtaining complete information about taxpayers, including data on the payroll fund, temporary workers, and objects of taxation.
Particular attention is being paid to the fight against dishonest practices. In 2024, over a thousand shell companies were identified. Plans are underway to strengthen control over the registration of LLCs and sole traders, introduce identification via Face ID, and ban the registration of new companies by founders who have tax debts or have committed serious violations.
An important area is the regulation of platform employment. A successful example is the pilot project with Yandex Taxi, which, since September 2024, has transferred 378 million tenge in individual income tax (IIT) for drivers and about a billion tenge in social payments. By the end of the first quarter, plans are to expand the project to more than 30 platforms.
Experts and business representatives broadly supported the direction of the reforms but put forward a number of proposals regarding their implementation. Particular attention was paid to issues of fair distribution of the tax burden and combating business fragmentation. According to Deputy Prime Minister Serik Zhurmangarin, in Kazakhstan, companies with revenue of between 39 and 78 million tenge often register 20-30 enterprises to remain in a more advantageous tax category.
Summing up the discussion, Prime Minister Olzhas Bektenov emphasised that the reform aims to create a fair system where everyone fulfils their obligations: the state – its social and economic ones, and business – its tax ones. Tax revenues are seen as a key source of funding for modernising infrastructure, developing transport and logistics potential, and strengthening the country's defence capabilities.
Work on the tax reform continues in close dialogue with the business community. The government seeks to find a balance between the need to increase budget revenues and creating favourable conditions for the development of entrepreneurship. Ultimately, the reform should contribute to the formation of a transparent and efficient tax system that meets the interests of the state, business, and society.
It is worth noting that following the instruction of Kassym-Jomart Tokayev, the government revised the initial plan to raise VAT to 20% and developed a more flexible approach taking into account the specifics of various economic sectors. The key element of the proposed reform became the introduction of a three-tier VAT system: a base rate of 16%, a reduced rate of 10% for certain sectors, and a full exemption for agricultural producers.