Deputy Prime Minister of Kazakhstan Serik Zhumangarin announced that the value-added tax (VAT) rate may rise from 12% to 20%. According to him, this decision is currently under discussion, and the final rate will be set after consultation with experts, Interfax reports.
Zhumangarin explained that the VAT rise will reduce the burden on the salary fund through eliminating social taxes and mandatory employer pension contributions. This should improve the financial situation of businesses and stimulate economic growth.
However, he noted that the VAT rise may cause prices for goods and services to grow, which will require added social support measures for vulnerable groups of the population.
Prime Minister Olzhas Bektenov emphasised the importance of tax reform to redistribute the tax burden and increase budget revenues. The draft Tax Code will be submitted for further discussion and approval to Parliament in February.
