Kazakhstan to determine new taxes but not rates

/REUTERS, Astana, Raushan Nurshaeva, June 18, 08/ - On Wednesday, Kazakhstan government presented innovations for production and other economic spheres within the frames of new Tax Code, however, still has not determined the rates, having promised to do so in a month. The country, which is rich in its natural recourses, announced on intention to increase raw spheres taxes with purpose to develop processing spheres more actively. On Wednesday, on tax conference the government informed on changing royalty for mineral resources production tax (MRPT) and abolishing of production-sharing agreement (PSHA) for new contracts. "Rates of mineral resources production tax on oil, including gas condensate will be made by progressive scale, taking volume (of extracting reserves, production) into account, based on world price" - is said in the government materials, distributed to journalists. Reducing ratios to MRPT`s rates will be established for non commercial worked- out deposits, list of which will be determined by the government. MRPT for metallurgic sector will also be dependent on world prices. "MRPT`s rates on solid mineral resources will be established differentially, depending on types and based on world prices, in amounts that compensate decreasing of corporate income tax's rate in new Tax Code and providing the descent level of profitability for subsoil users on every deposit". Government offers to exclude the regulation "on stability" of tax regime of contracts for all subsoil users, except Tengizshevroil and current PSHA. Authorities intend to include the flat rate of social tax instead of current regressive scale 13 to 5 % and reject tax calculation on every worker. Rates of corporate income tax and value added tax are considered to be reviewed. However, authorities don't tell about details of innovations. The Prime Minister Karim Masimov promised to tell the level of new rate in a month. "Today we intentionally did not tell the rates..., this question was omitted to discuss principles. The rate will be announced next time" - he said, finishing the tax conference. The Prime Minister added that Tax Code project discussions will be continued. The new Code will be included in parliament in September and come into effect since January 1, 2009. "Beginning January 1, 2009 we all should live according to the new Tax Code and our further development depends on how balanced it would be and how it would consider government, society and business interests" - Masimov said. [2008-06-19]