Government to decrease corporate income tax, to introduce flat rate for social tax and tax on expensive real estate

/INTERFAX-KAZAKHSTAN, Astana, July 30, 08/ - Kazakhstan government offers to decrease the rates of corporate income tax. "We offer to decrease the rates of corporate income tax down to 15-20 %. Possibly it (decreasing - IF-K) will be staged within years. - Karim Masimov, Prime minister of the republic said at the meeting regarding the tax bodies` operation results of the first half of 2008 in Astana. Today the corporate income tax rate equals to 30 %. Besides, the government offers to introduce unique (flat) rate of social tax within the frames of the new Tax Code development. "As we said on the first presentation of Tax Code - on transferring to "flat" rate of social tax. Earlier, we had individual progressive income tax, and then we introduced "flat" tax. Now, we suggest the "flat" rate of social tax to be in the amount of 11 %" - K. Masimov said. Additionally, according to the minister, the government intends to introduce the tax on expensive real estate of individuals. "We consider it necessary to increase tax rates on property of individuals and expensive real estate" - K. Masimov said. Particularly, according to his words, in accordance with development of the new Tax Code it is suggested to introduce tax on real estate of individuals over KZT30 m. worth (current rate - 120.18/$1), and a 1 %-2 % tax on real estate of legal entities. "I think the worldwide practice is fair: if you are rich, if you have opport- unity to pay for this (expensive property - IF-K) - then a pay reasonable tax - the Prime minister concluded. Moreover, on the same day, the head of the government authorized the Ministry of Economy to publish on its website the draft of the new Tax Code. "I authorize the Ministry of Economy and Budget Planning, as the main designer of the Tax Code, to publish on the website of the Ministry the draft of the new Tax Code so that we can make our remarks and suggestions, to be taken into account, and discussed because we are to live in accordance with this Law" - K. Masimov said. He also informed that the "Round table" devoted to discussion of the new Tax Code draft is planned on August 7 in Astana. "I make the decision August 7 in Astana we'll conduct the "round table" on discussion of the Tax Code draft. We got enough time for discussion (draft of new Tax Code - IF-K), then we'll again discuss it on a government session and introduce to the parliament" - he said. [2008-07-31]