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The patent tax system significantly eases the fulfillment of tax obligations for entrepreneurs, stated Almambet Shykmamatov, Chairman of the Tax Service of the Kyrgyz Republic.
Shykmamatov emphasized that this system exists in developed countries as well, though it may be known under different names. “Essentially, it is analogous to our patent system. Payments are made monthly and depend on turnover volume,” he explained.
As an example, he highlighted tax revenues from the Dordoi market: whereas previously about 480 million soms were collected annually, current tax revenues have risen to 1.6 billion soms — nearly a threefold increase.
Furthermore, the Chairman underscored that the patent system saves entrepreneurs valuable time by simplifying administrative procedures and reducing tax-related risks.
Analysis and Significance
The patent tax system represents a simplified taxation regime aimed at lowering the tax burden and streamlining tax administration for small and medium-sized enterprises. Its effectiveness is evident in the significant growth in tax revenues, indicating increased formalization and improved tax compliance.
The substantial rise in revenues from the Dordoi market illustrates how simplified tax mechanisms incentivize businesses to operate legally and remit taxes on time. Such reforms are critical for the country’s economic development, ensuring increased fiscal resources and easing compliance for taxpayers.
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