Majilis Members Criticize Proposed Changes to Tax Code

Deputies of the Majilis from the AMANAT party have criticized several provisions in the draft of Kazakhstan’s new Tax Code, particularly the proposal to lower the VAT registration threshold to 15 million tenge, Orda.kz reports.

At an extended meeting of the AMANAT faction, Majilis Speaker Yerlan Koshanov reminded that President Toqayev has emphasized that the tax reforms should not negatively impact entrepreneurs.

He stressed the need to strike a balance between economic development and support for business.

He also highlighted that one goal of the new Tax Code is to reduce the government’s reliance on the National Fund for financing.

Deputies voiced strong opposition to several proposals put forward by Minister of Economy Serik Zhumangarin.

One of the main points of contention was the plan to lower the VAT registration threshold to 15 million tenge.

Majilis members warned that such a move could seriously undermine small and medium-sized businesses, potentially driving many entrepreneurs into the shadow economy. The proposal to apply VAT to financial services and gradually raise taxes in the healthcare sector also faced sharp criticism.

Such measures will lead to higher prices and place an added burden on the population, which is unacceptable under the current circumstances. The issue of changes to special tax regimes also remains pressing — the faction believes it’s essential to preserve the retail tax system and simplify regulation by shifting to a ‘prohibited activities’ list, AMANAT stated.  

AMANAT deputies outlined the following key objections and demands:

• Set the VAT registration threshold at no less than 30 million tenge, instead of 15 million
• Exempt 19 socially important food products from VAT
• Apply zero VAT to books published in Kazakhstan, as well as to the fields of animation and archaeology
• Preserve the retail tax regime
• Do not lower the corporate income tax for the manufacturing sector from 20% to 10%, as it already enjoys sufficient tax preferences — the budget risks losing 94 billion tenge this year alone
• Maintain the 70% VAT benefit for farmers
• Protect 800,000 Kazakhstanis working in gig or platform-based employment from worsening tax conditions
• Intensify combating smuggling to reduce tax losses

Deputy Berik Beisengaliev also proposed revising how the mineral extraction tax is calculated on flared associated gas. Rather than basing it on production costs, he suggested linking it to global gas prices. 

Additionally, he proposed abolishing the alternative subsoil use tax for depleting oil fields and cutting tax breaks for companies processing solid minerals — reforms that, according to him, could bring over 1 trillion tenge into the state budget.

Earlier, Deputy Askhat Aimagambetov also commented on tax policy, advocating for VAT exemptions on medicines, books, and key services like healthcare and finance. He and other deputies also support higher taxes on bookmakers and an increased corporate income tax for banks.

Original Author: Nikita Drobny