Topic: Tax law of the Republic of Tajikistan

Tax system of RT on transition economy Stages of formation of Tajik Tax system Tax structure of Republic of Tajikistan

Tax system of RT on transition economy A transition economy or transitional economy is an economy which is changing from a centrally planned economy to a free market

Transition economies undergo economic liberalization, where market forces set prices rather than a central planning organization. In addition to this trade barriers are removed, there is a push to privatize state-owned businesses and resources, and a financial sector is created to facilitate macroeconomic stabilization and the movement of private capital

2. Stages of Formation of Tajik Tax system 1) – stage of formation of Tax Law 2) – Adopting of Tax code and improvement of Tax system 3) Adopting of the new Tax code and improvement of Tax system 4) Adopting of the new Tax code according President’s requirements

Challenges of 1 st formation Difficulties of Tax administration (more then 40 Taxes) Shortage of professional tax inspectors Tax law was not so clear to understand High level of corruption High Level of shadow economy Business was not so developed in this period

Challenges of 2 st formation Tax code articles were not so clear High level of corruption in Tax Authority Tax system has just a fiscal nature Tax code could not stimulate business, investments Difficulties of administrating of some taxes Tax administration is weak

Challenges of 3 rd formation Weak of Administration Tax system has just a fiscal nature Tax system could not stimulate investments, business A lot of indirect Taxes in Tax system Conflict among some articles

3. Tax structure of the Republic of Tajikistan Taxes of the Republic of Tajikistan shall consist of national taxes and local taxes.

National taxes shall include 1) the personal income tax (tax on income of individuals); 2) the corporate profit tax; 3) the value-added tax; 4) excise taxes; 5) the social tax; 6) the land tax; 7) the tax on users of mineral resources; 8) the highway user tax; 9) the tax paid under the simplified system; 10) the uniform tax for producers of agricultural products; 11) the customs duty and other customs payments; 12) the stamp duty; 13) the sales tax (cotton and primary aluminum); 14) the minimum business income tax; 15) other compulsory republic-wide payments.

Local taxes shall include: 1) the real estate tax; 2) the tax on owners of motor vehicles; 3) the retail sales tax; 4) other compulsory local payments.

Proceeds from national taxes shall be distributed between the republican budget and local budgets in accordance with the budget legislation of the Republic of Tajikistan. Local tax payments shall be applied to the respective local budgets.

Structure of Tax revenue (%)