The presidential decree “On additional measures to increase the welfare of the population through rapid development of entrepreneurship, innovative technologies and infrastructures in the Republic of Karakalpakstan” was adopted.
The decree includes news announced during President Shavkat Mirziyoyev’s visit to Nukus on August 26.
In particular, the following package of benefits have been granted for Karakalpakstan:
- From September 15, 2022, the sale of railway and air passenger tickets for pensioners and disabled persons living in Karakalpakstan and Khorezm will be carried out at 50% preferential rates;
- Low-income families will be provided with one-time assistance in the amount of 600,000 soums;
- People of Karakalpakstan will be allocated land for building courtyard houses;
- Additional admission quotas will be allocated for young people of Karakalpakstan;
- In order to provide higher education institutions in Karakalpakstan with potential professors and teachers, starting from 2023, targeted training of personnel in basic doctoral studies (PhD) in the fields of ecology, agriculture, irrigation and construction will be launched in the leading higher education institutions of Uzbekistan;
- Starting from October 1, 2022, the signing of agreements on public-private partnership in the field of preschool education in Karakalpakstan will be carried out by the Ministry of Preschool Education of Karakalpakstan as an exception.
Tax benefits
According to the decree, from January 1, 2023 to January 1, 2028, for business entities located in all districts of Karakalpakstan and operating in this area:
ꞏ tax rates for profit tax, turnover tax, property tax of legal entities and land tax from legal entities will be reduced by 50%;
ꞏ social tax has been reduced to 1% tax rate;
ꞏ the social tax paid by self-employed entrepreneurs has been reduced by 12 times for those operating in cities, and by 6 times for those operating in districts, and was set at 1 BCA per year.
Reimbursement of transport costs, providing guarantees for loans
ꞏ In the period from October 1, 2022 to January 1, 2028, 70% of the transport costs for the export of products produced in Karakalpakstan and the transport of goods purchased for the production of exported products across the republic will be covered by the Export Promotion Agency;
ꞏ Up to 75% of the allocated loan amount (including 75%), but the total value of which does not exceed 2.5 billion soums, a guarantee will be provided (at the expense of the State Fund for the Support of Entrepreneurial Activity).
New loans
To young entrepreneurs in Karakalpakstan:
- 7-year loans will be granted for the purchase of necessary equipment for production and service (according to the decision of the Government Commission, through the Young Entrepreneurs Support Fund under MIFT);
- these loan funds will be distributed by the Government Commission based on the proposals of the Council of Ministers of Karakalpakstan.
The list of projects to be financed from this credit line allocated to banks will be formed by the Government Commission based on the recommendation of the Council of Ministers of Karakalpakstan.
- Within 2 months, the “Investor Help Center” will be opened, which will provide free assistance to business entities operating in Karakalpakstan;
- In the center, a production technopark with an area of at least 10 hectares will be created from vacant plots not intended for agriculture;
- Land will be leased directly to large investors;
- Taxes will remain in Karakalpakstan;
- Non-agricultural land plots in Karakalpakstan will be issued with a 50% reduction in the starting price on the basis of property rights, electronic online auctions;
- 50% of the funds from the realization of electronic online auctions on the basis of property rights and leases, which are directed to the republican budget of Karakalpakstan, will be transferred to the budgets of the districts (cities) where these plots of land are located, as their additional resources;
- In Karakalpakstan, a program for water accounting, loss reduction and restoration of water supply will be developed;
- Up to 2 hectares of land will be leased to residents for 30 years;
- In order to eliminate the unevenness of cultivated fields and excessive consumption of water resources in Karakalpakstan, in 2022-2024, proposals will be made for the allocation of subsidies per hectare for leveling agricultural land with the help of land leveling units with a laser device;
- Subsidies in the livestock sector have been extended for 2 years for Karakalpakstan;
- Part of the international highway A-380 “Guzor-Bukhara-Nukus-Beyneu” passing through Karakalpakstan will be developed.
