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The State Tax Service of the Kyrgyz Republic has announced significant reforms to its tax legislation aimed at reducing the burden on businesses and strengthening investor confidence.
Deputy Chairman of the State Tax Service, Kubanychbek Ysabekov, emphasized that tax audits will no longer be conducted for periods before January 1, 2022, except for special cases such as company liquidation or criminal investigations. This reform is expected to ease administrative pressure on both local and foreign businesses operating in Kyrgyzstan.
Another key development is the introduction of a “Taxpayer Rating System”, designed to assess the compliance, reliability, and integrity of taxpayers.
- Companies with a high rating may benefit from fewer inspections, access to installment payment options for tax arrears, and other incentives.
- Taxpayers with a low rating, however, will face stricter monitoring.
These changes align with Kyrgyzstan’s broader policy to create a more transparent, predictable, and investor-friendly tax environment. For foreign companies, particularly those entering the Kyrgyz market, this means reduced compliance risks and a clearer framework for long-term planning.
The reforms are part of a law signed by President Sadyr Japarov to lower the overall tax burden and foster sustainable business growth. Analysts note that this move strengthens Kyrgyzstan’s position as an attractive destination for foreign investment in Central Asia.
Implications for Foreign Businesses and Advisors:
- Foreign investors should review their compliance strategies under the new rating system to secure a high taxpayer ranking.
- Legal and tax advisors have an opportunity to guide clients through these changes, ensuring risk mitigation and taking advantage of potential benefits such as debt restructuring and reduced audit exposure
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