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16 May 2019

Navoi region became a free economic zone

President of the Republic of Uzbekistan Shavkat Mirziyoyev signed a Decree “On Measures to Determine Navoi region as a Free Economic Zone for Innovative, High-Tech, Export-Oriented and Import-Replacing Production.”

Enterprises that intend to implement investment projects to create innovative, high-tech, export-oriented and import-substituting industries within the territorial boundaries of Navoi region can now receive the status of a participant in the Navoi free economic zone with a compact location of production facilities in territories with existing or easily created infrastructure.

Enterprises that have received the status of a participant in the Navoi free economic zone are exempt from payment:

  • land tax, income tax, property tax of legal entities, single tax payment for micro firms and small enterprises;
  • customs payments (except for customs clearance fees) for equipment, raw materials, materials and components imported for their own production needs, with the target direction of the released funds for the creation of new ones, as well as modernization, reconstruction, technical and technological re-equipment, expansion of existing industries, construction industrial buildings, the acquisition of raw materials and materials necessary for their own production needs, without the right to refund the negative amount of the tax on the value arising from the export of products;
  • customs payments (except for customs clearance fees) for construction materials not produced in the republic and imported as part of projects, according to the lists generated in the prescribed manner.

These benefits are granted for a period of 3 to 10 years depending on the amount of investments made:

  • from $ 300 thousand to $ 3 million – for a period of 3 years;
  • from $ 3 million to $ 5 million – for a period of 5 years;
  • from $ 5 million to $ 10 million – for a period of 7 years;
  • from $ 10 million and more – for a period of 10 years, with the use of the profit tax rate and the single tax payment in the amount of 50% below the current rates for the next 5 years.

Companies in the FEZ will also be allowed to use the conditions convenient for them, forms of payment and payments for the sale of goods. With respect to these enterprises, tax legislation acts that worsen the position of taxpayers, with the exception of acts regulating the taxation of excisable goods.

For founders of enterprises with foreign investments – participants of the Navoi FEZ and members of their families, from 1 June 2019, an “investment visa” is introduced for a period of up to three years with the possibility of its extension without leaving the republic.