Changes made to Tax Code
According to the new changes, taxpayers will be notified of the presence of tax liabilities. To do this, citizens can provide the tax authority with information about their phone numbers and e-mail address. Fulfillment of tax obligations of entrepreneurs will be simplified with the introduction of the e-SalyqBusiness mobile application.
The application will make it possible to register online as an individual entrepreneur, calculate taxes and social payments, cancel the presentation of the tax form for persons applying the specified special tax regime. The arrest of accounts will be applied only if the tax debt exceeds 6 MCI (17,502 tenge). If the debt is below this amount, the measures to freeze the accounts are not applied.
Second-tier banks are now empowered to conduct debit transactions on the account until the tax authority's order to suspend debit transactions on the taxpayer's bank accounts upon repayment of the debt specified therein is revoked.
An individual entrepreneur, who is not a VAT payer, for civil transactions in the amount of more than 1,000 MCI (2.9 million tenge), instead of issuing an e-invoice, has the right to provide the buyer with such an online cash register check. Also, if an entrepreneur directs income for reinvestment in new fixed assets, then this income will not be subject to CIT. This measure is envisaged in order to improve the investment climate and development of the manufacturing industry, as small businesses in the manufacturing industry do not tax the CIT profit, which will be reinvested in the development of production (acquisition or construction of buildings and structures for industrial purposes). The deductibility of interest expense on intercompany loans is intended to provide the deductible for deduction of interest expense on loans received by subsidiaries from the national parent company.
The Tax Code provides for a number of the following changes:
- Correspondence of the norms of the Tax Code with the legislation on the cotton industry is provided in connection with the adoption of Amendments to Certain Legislative Acts on the Cotton Industry and invalidation of the Law On Development of the Cotton Industry ";
- a decrease in taxable income for CIT by social entrepreneurship entities in the amount of expenses incurred to pay for training, advanced training or retraining of socially vulnerable categories of the population who are in labor relations with such an entity, but not more than 120 times the MCI effective as of January 1 of the corresponding financial year per employee for the tax period, provided for the purpose of stimulating social entrepreneurship;
- application of an additional VAT offset (70%) is provided for new manufacturing companies in the sale of goods resulting from the implementation of activities for the production of products in the manufacturing industry in order to stimulate creation of new industries, as well as increase investment in the manufacturing industry;
- extension of VAT exemption on imports to FEZ "Qyzyljar" is provided with the aim of reducing the cost of agricultural machinery by 12% and ensuring its availability;
- application of the minimum level of reference prices for certain goods from the EAEU will help prevent the facts of understating the value of imported goods and enable VAT collection from the current taxable base, the measure is aimed at supporting and protecting domestic producers, since it will allow the use of mirror measures in relation to countries that discriminate export;
- application of a reduced rate of 0.5% on property tax by social entrepreneurship entities and granting of the right to choose in the application of one of the lowest tax rates, if the social entrepreneurship entity complies with several provisions of paragraphs 2, 3, 4 and 5 of Article 521 of the Tax Code, the changes that are envisaged in order to ensure access of representatives of certain target groups to entrepreneurial activity;
- granting for 2 years (from 2023 to 2025) the right to entrepreneurs in public catering to apply the STR of the retail turnover tax, with a tax rate of 6%, this measure is provided in order to reduce the tax burden for the public catering sector;
- deduction for the purpose of calculating CIT of the employer's expenses in favor of employees aimed at organizing and conducting sanitary and anti-epidemic, sanitary-preventive measures in connection with the introduction of restrictive measures, including quarantine, as well as not recognizing these expenses as an employee's income;
- introduction of fees for digital mining is provided for the purpose of legislative regulation of the industry for the extraction of crypto currencies, as well as increasing the income of funds to the budget from mining;
- extension of the deadline for submitting a certificate of residence until December 31, 2021 is provided in order to avoid double taxation during the period of restrictive measures, since the submission of documents is difficult due to quarantine measures in foreign countries;
- a deferral is provided for the payment of personal income tax and social tax with payroll from April 1 to July 1, 2021 in order to support business entities in the sectors most affected by the pandemic.
Source: Kazpravda.kz
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Kazakhstan turns to high-value added manufacturing with building polyethylene plant it Atyrau region
Images | primeminister.kz
Prime Minister of the Republic of Kazakhstan Olzhas Bektenov met with the heads of the world's largest oil and gas chemical companies – President of China Petrochemical Corporation (SINOPEC) Zhao Dong and Chairman of the Board of SIBUR LLC Mikhail Karisalovб primeminister.kz reports.
The key issue is the joint construction of the first integrated gas chemical complex for polyethylene production at a cost of about $7.7 billion and a capacity of 1.25 million tonnes per year, which will account for 1% of the world's total capacity.
A tripartite protocol was signed during the meeting, officially finalising SINOPEC's entry into the project. The ownership structure of the plant is as follows: KazMunayGas 40%, SINOPEC 30%, SIBUR 30%.
Head of the Government emphasised the importance of the project due to its focus on the production of high value-added products.
A gas separation complex (GSC) will be built at the Tengiz field to supply the "Polyethylene" project with feedstock (ethane). The capacity of the GSC is 9.1 billion m3 of dry gas processing per year, of which 1.6 million tonnes of ethane is expected to be produced.
Ethane will be sent through the main pipeline from Tengiz to the Karabatan site (territory of FEZ NINT, Atyrau region), where the polyethylene plant will operate.
It is planned to produce about 22 grades of polyethylene using American licence technologies of Chevron Phillips and Univation, 40% of which will be premium grade. A wide range of applications for both industrial and household purposes makes polyethylene the most popular polymer in the world.
Polyethylene is used in the fields of medicine, prosthetics, defence, food industry, construction, space industry and others. This polymer is used in the production of a wide range of goods: from plastic wear-resistant pipes, construction materials, medicines, syringes, prostheses to bulletproof vests, clothing for astronauts and car parts. Target markets include Kazakhstan, CIS countries, China, Turkey and European countries. At the same time, for domestic consumption, the realisation price will be lower than the import price.
The Head of State has identified deep processing of hydrocarbons as one of the key areas of development of the oil and gas sector. The priority for our economy is high conversion production producing products with a rapid increase in added value in the technological chain with an export orientation. The added value between the initial feedstock ethane and the third conversion product polyethylene increases 20 times, from $80-90 to $1600-1800 per tonne. The Polyethylene project will certainly give a serious impetus to the development of both the manufacturing industry and the country's economy as a whole. According to experts' calculations, the contribution to the country's GDP by 2030 from the implementation of the project is estimated at approximately 1.2%," Olzhas Bektenov said.
The construction of the plant is planned to be completed by 2029. During the construction period more than 8 thousand jobs will be created, during the operation period about 850 jobs will be created.
It was noted that the project is realised with the support of the Government. The plant will be built on the territory of a special economic zone with the provision of appropriate infrastructure and special tax regime. In this regard, Prime Minister emphasised the attention of the project participants to the need to maximise the use of local potential.
We on the part of the state provide comprehensive support in the implementation of projects important for the country's economy. At the same time, we expect you to increase the share of local content. For this purpose, it is necessary to determine the list of goods and equipment that will be mandatorily purchased from domestic producers. Special attention should be paid to training of Kazakhstani specialists and transfer of competences. It is important for us to maximise the attraction of local personnel, including for management positions in the project. We count on a similar approach in the implementation of other joint projects," Prime Minister emphasised.
Thus, in addition to the plant "Polyethylene" it is planned to build a gas separation complex and a trunk pipeline.
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Olzhas Bektenov and Head of the Sakha Republic Aysen Nikolayev discuss issues of trade and economic cooperation
Images | primeminister.kz
Prime Minister of the Republic of Kazakhstan Olzhas Bektenov met with the Head of the Republic of Sakha (Yakutia) Aysen Nikolayev, who arrived on a visit to Astana to participate in the opening ceremony of the Days of the Republic of Sakha in Kazakhstan, primeminister.kz reports.
The Republic of Sakha contributes to the development of Kazakhstan-Russia trade relations. The implementation of agreements reached at the level of the presidents of Kazakhstan and Russia on further expansion of bilateral trade and economic cooperation was reviewed.
Over the year, trade turnover between the regions of Kazakhstan and the Republic of Sakha has grown almost 2-fold, exceeding $160 million, with over 99% of exports of Kazakhstani goods. During the discussion a wide potential of mutual trade was noted and the parties' readiness to increase turnover in agricultural, industrial and IT spheres was outlined.
The parties confirmed their intention to intensify joint work on expanding the range of supplied goods and services, establishing direct contacts between business circles. It is expected that a new impetus to trade and economic relations will also be given by the launch of five major cross-border trade centres in Kazakhstan, including the Eurasia Cross-Border Trade Centre on the border with Russia.
Special attention was paid to the exchange of experience and technologies in the field of creative industries and digitalisation, as well as interaction between research institutes and educational institutions of Kazakhstan and the Republic of Sakha.
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