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: / Analytics / The Tax System of the Kyrgyz Republic (2003)




Kyrgyzstan Review, 10 years ago




INTRODUCTION

This report was prepared within the framework of the Comparative Analysis of Tax Regimes project of the TACIS Kyrgyzstan SME Development Programme. The objectives of this project are to improve the government revenue collection system, to create more significant incentives for economic growth and to increase transparency in economic activity.
 
The main tasks of the project are: analysis of the existing tax system of Kyrgyzstan and revealing its most significant problems; ascertaining the opinion of businessmen regarding the tax system; analysis of the experience of the countries, which also are in transition from the socialist economic system to the market economy, and, finally, formulating recommendations on improvement of the tax system.
 
The report has the following structure. The role of the tax system in the economy of the country and specific features of the economic situation affecting taxation are considered in Chapter 1. Chapter 2 contains a brief analysis of all taxes and compulsory payments, which are currently valid in Kyrgyzstan (a comprehensive analysis of the legislation is attached in Appendix 1). Chapter 3 contains analysis of losses of the government budget of Kyrgyzstan caused by imperfections of the tax system. This analysis was performed by application of a series of models, which were also described in Chapter 3. Chapter 4 contains analysis of the information obtained in the process of discussions held with businessmen on the issues of the tax system. The discussions were held by the officers of CASE-Kyrgyzstan at 10 enterprises of various branches and forms of ownership. Chapter 5 contains a brief summary of the experience of the four transition countries (Poland, Estonia, Russia, Kazakhstan), whose experience is of interest for Kyrgyzstan. Chapter 6 contains recommendations on reforming of the tax system of Kyrgyzstan made on the basis of the whole preceding discussion.
 
This report was prepared by the researchers of the Center for Social and Economic Research CASE-Kyrgyzstan: R.Mogilevsky (team leader), R.Brudzynski, A.Atamanov, J.Mironova. Analytical materials provided by the Financial and Consulting Company Niet-Araket headed by N.Elebaev were used for preparation of the report. On the part of TACIS the Project was coordinated by D.Grant, chief of the TACIS Programme, to whom CASE-Kyrgyzstan is grateful for the provided support. The authors of the report are grateful to Mr. N.Elebaev and his colleagues for fruitful cooperation in the process of the project implementation.
 
Views and opinions expressed in this report are those of the authors of the report and do not necessarily coincide with the position of the project donors or participating organizations.