Uzbekistan Provides Tax Incentives, Loans to Businesses in Remote Regions

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Apr 2017
Uzbekistan, April, 04 2017 - The President of Uzbekistan has provided a wide range of benefits and preferences to businesses operating in the country’s Khorezm province and Karakalpakstan autonomous region, the Jahon information agency reports.

The President’s decree has exempted legal entities registered and operating in the two regions from mandatory sales of foreign exchange earnings from exports of industrial products they produce, with the exception of commodities.

In addition, from April 1, 2017 until January 1, 2022, the legal entities of the two regions specializing in the production of pharmaceuticals, electrical products, and finishing building materials will not pay the property tax, land tax, land improvement and social infrastructure development tax, as well as mandatory contributions to public funds.

The only condition is that the share of net proceeds from sales of abovementioned products in the total volume of a company's income should be at least 60% at the end of the year.

Manufacturers of cable and wire products were not included in the list of beneficiaries.

In other news, the government of Uzbekistan has approved new measures to expand access to preferential micro loans for business entities and the general public, Jahon reports.

The government has introduced a simplified mechanism of allocation of micro loans to newly registered individual entrepreneurs and family businesses without the establishment of legal entity.

"The new mechanism provides for the issuance of micro loans for them in the amount of up to 20 times the minimum wage with the adoption of collateral for the goods needed for running business," the document says.

In addition, according to the measures approved by the head of state, it is planned to expand the practice of allocating micro loans for entrepreneurial activities in the amount of up to 60 times the minimum wage pursuant to guarantees of citizens’ self-government bodies.

Also, commercial banks will issue loans from the Preferential Lending Fund in amounts of up to 100 times the minimum wage for newly registered small business entities in remote and hard-to-reach regions, as well as areas with excessive labor resources. The measures are expected to help increase employment through encouragement of individual labor activity.



 

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