STS answers business questions on the application of the new Tax Code

On May 24, 2022, the issues of the business community arising from the application of the new Tax Code were discussed by the Fiscal Policy Committee of the International Business Council together with representatives of the State Tax Service under the Ministry of Finance of the Kyrgyz Republic.

The new Tax Code of the Kyrgyz Republic was put into effect on January 1, 2022. And immediately after the TC introduction, businesses had questions on its application, and a lot of them still arise.

Deputy Chairman of the State Tax Service Nurlan Umtulov, heads of STS departments answered questions from IBC members representing various sectors of the country's economy including banking, financial, mining, telecommunications, industrial, audit and consulting, logistics and transport.

“The participants of the meeting expressed their gratitude for the timely organization of the meeting,” said IBC head Askar Sydykov.

“We prepared a detailed list of questions from IBC members in advance, and many of them were discussed at the meeting, including the administration of value added tax, registration and taxation of foreign companies that do not have a permanent establishment in Kyrgyzstan,” he added.

Many business issues were related to non-cash payments and the use of cash registers.

The participants asked what taxation regime is applicable to non-profit organizations. Can VAT be credited for services provided to foreign companies that do not have a permanent establishment in the Kyrgyz Republic (for example, the so-called VAT on Google), and if so, what is the procedure?

The issue of payment systems turned out to be useful for everyone. It turned out that when paying through electronic wallets, the date of delivery of goods and services is the time when payment is received by the final seller.

According to the State Tax Service, information systems are currently being launched on innovations that are provided for by law. For example, electronic systems are being developed to record the taxation of foreign companies. E-systems are supplemented by new reporting forms provided for by the new Tax Code.

“At all stages of the new Tax Code — from the beginning of its development, during the public discussion and now, when it has already entered into force, IBC continues to actively resolve business issues in this area,” said Askar Sydykov.