Kazakhstan's Minister of National Economy Serik Zhumangarin assessed the country's tax reform at a government briefing, according to infohub.kz.
Journalists noted that value-added tax had been raised to 16%, yet the plan for it was fulfilled by only around 90%. They asked why nearly 700 billion tenge had been undercollected and whether the reform could be considered to have failed to deliver the expected effect.
Serik Zhumangarin disagreed with that framing.
"In fact, if you recall, at the end of last year we forecast that we would collect more than 4 trillion from the tax reform. Nine months have passed, and we have received 3 trillion from the tax reform. And in fact, the country's economy is growing at 4.2%. Despite the fact that we did not produce 6 million tons of oil, despite the fact that the tenge has strengthened very significantly, and despite the fact that our consumer lending sector has cooled. Today the tax reform is the only source of cash in the economy. And I believe it has not merely succeeded — it is performing splendidly," the head of the Ministry of National Economy said.
He announced a new revenue forecast.
"My forecasts through the end of the year are at least 3.6 trillion tenge, at minimum, plus what the tax reform will give to the economy. It may give more. Moreover, we forecast that of the more than 4 trillion, over 2 trillion would come from VAT. In fact, VAT is now the tax leader in terms of budget revenue. More than 37% of budget revenue comes from taxes," Zhumangarin added.
He also pointed to a sharp increase in the number of legal entities that are VAT payers.
"They usually grew by 4,000, 5,000, 6,000 a year. Their number increased by 37,000 in a year. And, in principle, the entire structure of entrepreneurship is being restructured. Therefore I cannot agree with you that the forecasts we counted on have failed," the head of the Ministry of National Economy concluded.
Earlier we wrote that Zhumangarin commented on the revision of articles in the Tax Code.