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OVERVIEW OF THE NEW TAX CODE
We hereby present for your attention an overview of the key changes introduced by the new Tax Code.
I. GENERAL PROVISIONS
Principle of Transparency
A new principle has been introduced – the principle of transparency: taxation rules and actions of tax authorities must be clear, open, and accessible to taxpayers. Taxpayers have been granted the right to demand clear, reasoned, and exhaustive explanations from tax authorities, both regarding the application of the Code's provisions and with respect to specific actions or omissions. If this requirement is violated, for example in the case of an incomplete response or concealment of the grounds for decisions, the taxpayer is entitled to appeal such actions.
Expansion of the Principle of Good Faith
The content of the principle of good faith has also been expanded: the Code explicitly defines cases that are recognized as manifestations of bad faith. These include misrepresentation of data on business activities, taxable objects, accounting and reporting, conclusion of sham transactions for the purpose of tax evasion, as well as the performance of obligations by "front" persons who are not parties to the agreement. At the same time, an important guarantee has been established: non-payment of tax by a supplier cannot serve as an independent ground for denying the purchaser the recognition of expenses.
Introduction and Control of Tax Benefits
In the area of tax benefits, a procedure for their codification in the Tax Code and annual effectiveness analysis has been introduced. In addition, an aggregate cap on benefits has been established — not more than 10% of GDP.
II. TAX ADMINISTRATION
VAT Registration
With respect to Value Added Tax (VAT), the threshold for mandatory registration has been reduced to 10,000 MCI, which is almost half of the previous threshold. The deadline for submitting the application has also been shortened to five business days.
An important clarification has also been introduced: if a taxpayer plans a one-time large transaction, the amount of which exceeds the established threshold, VAT registration must be completed in advance, before carrying out such a transaction.
Monitoring of Tax Registration
To enhance control, a mechanism for monitoring tax registration has been introduced based on data from state authorities and banks. In case of violations, additional measures may be applied: suspension of banking operations for Kazakhstani companies and restriction of access to online resources for foreign online companies.
Expansion of the Circle of Entities Required to Exchange Information
The list of entities obliged to exchange information with tax authorities has been significantly expanded. In addition to state authorities, banks, and notaries, this list now includes appraisers, marketplaces, payment systems, utility providers, quasi-public sector organizations, exchanges, lessors of retail premises, mining pools and crypto-asset operators, as well as public institutions, including individuals and non-profit organizations with foreign funding.
Automatic Filing of Zero Returns and Format-Logical Control
The processes of filing tax returns have been simplified. The system has been given the ability to automatically submit zero returns in the absence of turnover. A return is now deemed filed only after passing mandatory format-logical control. In addition, electronic forms are established as the main method of filing returns, while paper format is allowed only in exceptional cases.
Deferral and Installments of Tax Liabilities
The procedure for granting deferrals and installments of tax liabilities has been changed. For most taxpayers, the terms remain the same — up to 6 months for deferral and up to 36 months for installments. However, for participants of horizontal monitoring, special conditions have been introduced: deferral may be granted for 12 months, while installments are limited to the same term.
A deferral of payment of import VAT on goods used in production has also been introduced, although this benefit does not apply to imports from EAEU countries.
III. TAX RISK MANAGEMENT AND TAX CONTROL
Risk Management System
The risk management system has undergone changes. Whereas previously it was based on categorizing taxpayers by risk levels, now the focus has shifted to preventive measures — notifications and reminders about deadlines for filing returns and paying taxes, as well as control measures with active use of automated information systems. At the same time, information on criteria and procedures is deemed strictly confidential and is not disclosed to taxpayers. Unlike the previous Code, where some criteria could be open and applied in parallel with closed ones, the new Tax Code fully excludes taxpayer access to information on criteria.
Desk Audit (Cameral Control)
The desk audit model has also changed. Abandoning differentiation by risk levels, the new Code establishes a single document — a notice of discrepancies. In explanations to such a notice, it is sufficient to indicate identification data, notice number, and reasons for disagreement, attaching supporting documents if necessary. At the same time, the prohibition on submitting explanations for transactions recognized as fictitious remains. However, mitigation is provided for bona fide taxpayers: it is allowed to provide explanations for transactions with companies whose registration has been declared invalid if the court has established the fact of actual acquisition of goods or services.
Tax Monitoring
Tax monitoring has been expanded: it now covers not only traditionally large taxpayers, but also banks, insurance organizations, and professional participants of the securities market. The deadline for submitting documents within monitoring has been shortened to 15 business days, and instead of the usual document exchange, a digital "data showcase" is being introduced. Disputed issues are subject to consideration by the Advisory Council under the Ministry of Finance, creating a new collegial pre-trial mechanism for resolving disputes.
Control over Electronic Invoices (E-Invoices)
A separate chapter is devoted to control over electronic invoices (E-Invoices). Automated control provides for registration of invoices within the "VAT balance" on a special tax account, and in case of insufficiency — the possibility of topping up the account with own funds. Comparative control is based on matching E-Invoice data, tax returns, and information from state authorities and banks. If doubts are identified, the taxpayer receives a notice requiring either withdrawal of disputed invoices or confirmation of their validity with documents. If explanations are not accepted, strict measures apply: suspension of issuing E-Invoices and debit operations on accounts, publication of information about the taxpayer, and notification of its counterparties.
Tax Audits
The new Tax Code explicitly provides that the tax burden coefficient is now used as a criterion for initiating a tax audit. In addition, tax authorities' rights have been expanded in terms of access to information systems and accounting software.
Changes also affect audits upon company liquidation. Previously they were mandatory, but now a differentiated approach is applied. An audit is carried out only in the presence of debt, identified risks, or in relation to large taxpayers and entities with special tax obligations. For small and medium-sized businesses, in the absence of debt and subject to timely filing of returns, a simplified deregistration procedure is provided — without field audit, limited to desk audit.
The institution of a preliminary tax audit report has also been unified. It now applies to all types of audits, except for cases when an audit is carried out upon complaint (e.g., by a non-resident on tax refund): in such situations, a final report is prepared immediately.
Appeal of Decisions and Actions of Tax Authorities
The procedure for appealing notices and actions of tax authorities has retained its previous logic. The new Code explicitly provides for the possibility of filing and withdrawing a complaint in electronic form, while the requirement to issue a preliminary decision on the complaint has been eliminated. At the same time, it is stipulated that appealing actions of tax authorities regarding enforcement of tax obligations and collection of arrears does not suspend their application.
Tax Survey
Special attention is paid to tax surveys: now the taxpayer must be notified of the survey no later than three business days in advance. If the taxpayer does not confirm its location, the tax authority has the right to suspend the issuance of E-Invoices.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
