New Tax Code: key changes

On July 18, 2025, the President of Kazakhstan signed a new Tax Code, which will come into effect on January 1, 2026.

The new Tax Code introduces a significant simplification of tax administration. Major changes affect all core areas—from corporate and individual income taxes to investment incentives and redistribution of tax burdens.

The main goals of the new Tax Code:

Introduction of differentiated tax rates across sectors;
Reform of special tax regimes;
Streamlining and reducing tax incentives by at least 20%, with clear criteria for their application;
Transition to a service-oriented model of interaction between tax authorities and taxpayers;
Modernization of tax administration;
Digitalization of tax control, with a 30% reduction in reporting forms;
A 20% reduction in the number of taxes and other mandatory payments;
Simplification of VAT refund procedures.

Key changes introduced:

VAT rate set at 16%; VAT registration threshold is 40 million KZT.
Exemptions from VAT: socially important food products, book publishing, archaeological services.
A list of VAT-exempt medicines to be approved.
Paid medical services taxed at 10% VAT.
VAT exemption for developers cancelled.
Bank commissions subject to VAT.

Special Tax Regimes reduced from 7 to 3:

Regime for self-employed individuals.
Simplified declaration regime (B2C focus): income limit 2.36 bln KZT, no staff limit, tax rate 4% (can be reduced to 2%), no VAT obligation. Businesses under general regime cannot deduct expenses from special regime suppliers.
Regime for peasant and farm enterprises.

CIT (Corporate Income Tax) remains 20%, with sector-specific rates:

25% for banks and gambling;
10% for financial leasing, education, healthcare (gradually: 5% in 2026, 10% in 2027);
3% for agriculture (70% discount from 10%).

Other notable provisions:

Up to 100-fold increase in land use fees for inefficient agricultural land use.
100% deductions for exploration companies on capex.
Tax preferences for processing solid minerals; 0% MET for 5 years for new low-profit sites.
Alternative subsoil tax with reinvestment obligation for mature oil fields.
Total number of taxes reduced from 12 to 11; fees from 10 to 6; 77 tax rates cut.
Tax reporting reduced by 30%; minor arrears no longer justify account blocking.
128 tax benefits cancelled (over 1.3 trillion KZT).
Luxury tax introduced: higher rates on property over 450 mln KZT, cars over 75 mln KZT, yachts, aircraft, 10% excise on premium alcohol and cigars.
Increased excises on alcohol, tobacco, energy drinks, trans fats.
15% PIT for annual income over 8,500 MCI (~33.4 mln KZT); base PIT for others stays at 10%.
Base salary deduction raised to 30 MCI (~118,000 KZT).
Social PIT deduction for persons with disabilities and parents of disabled children up to 5,000 MCI (~19.7 mln KZT).
Divorce state duty raised to 5 MCI (~19,700 KZT).
Pension payments from the UAPF exempt from PIT.
Income from government and quasi-public securities now taxable.