The government, by its resolution, will authorize the Minister of Industry and Construction to sign an agreement on the processing of solid minerals, under which the investor will be provided with tax benefits.
“In accordance with Article 243 of the Code of the Republic of Kazakhstan “On Subsoil and Subsoil Use,” the Government of the Republic of Kazakhstan decides: 1. To approve the attached draft agreement on the processing of solid minerals in accordance with the appendix to this resolution. 2. Authorize the Minister of Industry and Construction of the Republic of Kazakhstan (Kanat Sharlapaev – “Italics”) to sign an agreement on the processing of solid minerals,” says the draft government resolution published for discussion.
To receive preferences, the volume of investments of the subsoil user in the solid minerals processing project must be at least 70 million monthly calculation indicators, or 258.44 billion tenge for 2024.
A project for processing solid minerals will be considered a set of measures to create new, expand or modernize existing production facilities for processing solid minerals. Investments in the processing project will be considered all types of property (except for goods intended for personal consumption), including items of financial leasing from the date of the leasing agreement, as well as the rights to them invested by the investor in the authorized capital of the investor or an increase in fixed assets used for business activities.
After signing an agreement on the processing of solid minerals, the investor is presented with the following types of preferences: a reduction in corporate income tax by 100% on income from the implementation of an investment project; application of coefficient 0 when calculating land tax on land plots used for the implementation of an investment project; application of a 0 percent rate to the tax base when calculating property tax on objects used for the implementation of an investment project.
Benefits for CIT and land tax are provided for a period of up to 10 years, for property tax – up to eight years, if the level of internal rate of return for the field does not exceed 15%. Upon reaching the specified rate of profitability, the enterprise will pay taxes in the generally established manner, that is, without benefits. However, if the rate of return decreases below 15%, the taxpayer will again have the right to take advantage of the benefits.
Upon early termination of the agreement, the investor will be required to pay taxes and customs duties and/or other benefits provided under the agreement. The resolution comes into force 10 calendar days after the day of its first official publication. Public discussion of the document will last until February 26.