DUSHANBE, December 10, 2013, Asia-Plus — The new tax code will simplify filing for small and medium-sized enterprises (SMEs), but tax administration remains a weak point in the business environment, according to World Bank”s
Tajikistan Partnership Program Snapshot
that was published in October this year.
The new tax code was prepared with support from the International Monetary Fund (IMF) and International Finance Corporation (IFC). Some key changes include the elimination of the retail sales tax, the phasing out of the road user tax by 2017, an increase in the threshold for value added tax (VAT) filing to be harmonized with the upper threshold of the simplified regime, a unified declaration for social and personal income tax, and simplified filing and payment procedures such as reduced filing for some taxes from monthly to quarterly.
Initial estimates put the compliance cost savings of the reforms at well over US$10 million annually, mostly accrued to SMEs. However, despite these reforms, there is discontent with some aspects, of the new tax code, tied for the most part to the elimination of some VAT exemptions, the reduction of the threshold for patent regime filing, the elimination of deductions for business expenses paid to patent holders, and ongoing concerns over how fairly the code will be implemented.
Tax administration remains one of the most problematic issues in the business environment, and the State Tax Committee will soon begin a full functional review of its operations with support from the
Tax Administration Reform Project
funded by the World Bank.
