IMF Advises Uzbekistan to Introduce Progressive Tax System

The International Monetary Fund (IMF) has recommended that Uzbekistan transition from its current flat income tax rate to a progressive tax system. The proposal also includes reviewing existing tax exemptions and reducing the number of investment incentives.

Uzbekistan currently applies a flat income tax rate. However, as Gazeta.uz recalls, authorities have previously stated that a progressive system could be introduced once the taxpayer base expands.

The IMF believes that broadening the tax base and reforming the tax system are essential steps to ensure sufficient funding for key social and infrastructure initiatives.

In addition, the IMF has advised the government to reform the State Tax Committee. As part of this, the Fund suggests adopting a five-year strategic development plan for the institution.

Earlier, Kursiv Uzbekistan reported that the IMF had also recommended that Uzbekistan reform its pension system.