TASHKENT (Asia-Plus) — Uzbek President Shavkat Mirziyoyev on December 24 signed the law on making changes and addenda to the country’s tax code. In accordance with the amendments made to the tax code, a single 12% income tax for physical entities will be introduced in Uzbekistan beginning on January 1, 2019.

The rate of income tax for legal entities is different depending on operational area, ranging from 12% for legal entities to 20% for commercial banks, enterprises producing cement (clinker) and polyethylene granules as well mobile service provider.

The rate of taxes on dividends and interest income is reportedly set at 5%.

Meanwhile, speaking at a government session on December 20, President Mirziyoyev reportedly paid special attention to the issue of preventing price increases as a result of the spread of VAT on small business.

A number of innovations were introduced to the new tax system for legalizing informal activities. Therefore, the profit tax is reduced from 14 to 12% percent, paid only when the entrepreneur receives income. To reduce informal employment, instead of income tax, reaching up to 30% of the wage, a single 12% tax is introduced, and 8% insurance premiums is completely abolished. The rate of the unified social payment, which has put a heavy burden on the business community, has been reduced from 25% to 12%. The rates of fixed tax payment for individual entrepreneurs are reduced by 30%.