Special Retail Tax Regime Of 3%

From 1 January 2021, a number of changes provided for by the Law come into force¹.

Thus, a new Chapter 77-1 of the Tax Code entered into force, which contains provisions on the application of the special retail tax regime (SRTR), which will be an alternative to CIT or IIT for businessmen.

Application Period

The new tax regime is introduced for the period of 1 January 2021 through 1 January 2023. To switch to this tax regime, a taxpayer shall submit a Notice of Tax Regime Applied to the tax authority at location.

Tax Benefits

The main feature of this tax regime is a reduced rate of 3% applied to the taxpayer's income. Thereat, according to the information provided by the State Revenue Committee of the Ministry of Finance of the Republic of Kazakhstan, unlike the general taxation procedure, a rate of 3% applies to income excluding expenses. Besides, the taxpayers that enjoy the SRTR shall be exempt from social tax.

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Footnote

1. The Law of the Republic of Kazakhstan dated 10 December 2020 No. 382-VI 'On the Introduction of Amendments to the Code of the Republic of Kazakhstan 'On Taxes and Other Obligatory Payments to the Budget' (Tax Code)' and the Law of the Republic of Kazakhstan 'On the Enactment of the Code of the Republic of Kazakhstan 'On Taxes and Other Obligatory Payments to the Budget' (Tax Code)'.

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