IFC, IMF, and State Tax Committee of Tajikistan Host Conference on Tax Administration
In Dushanbe:
Andrea Dall’Olio - IFC
Phone: +992 48 701 1459
E-mail: adallolio@ifc.org
Luc Moers - IMF
Phone: +992 44 600 3234
E-mail: lmoers@imf.org
Dushanbe, July 6, 2007 — IFC, the
private sector arm of the World Bank Group, the International Monetary
Fund, and the State Tax Committee of Tajikistan last week hosted a conference
on “Tax Administration Development during the Independence Period of the
Republic of Tajikistan.” The objective was to increase entrepreneurs’
awareness of the 2005 tax code and discuss further improvements in tax
administration.
The State Tax Committee of Tajikistan expressed its readiness to consider
suggestions from entrepreneurs and other interested parties to improve
tax administration.
“Tajikistan’s tax system needs to help achieve goals such as increasing
tax collection, promoting and developing small and medium entreprises,
and attracting foreign and domestic investments to develop industrial potential
and create new jobs,” said Bakhtiyor Sultonov, Deputy Chairman of the
State Tax Committee of Tajikistan.
IFC’s Andrea Dall’Olio described the current situation in small and medium
enterprise taxation based on the results of the business-environment survey
conducted by IFC in Tajikistan in 2006. According to the survey, tax administration
in the country is cumbersome, while the overall burden is high, especially
for growing businesses. The survey also revealed that the patent system
of taxation, preferred by most individual entrepreneurs, is complicated
due to the need to pay social and retail taxes separately.
“Creating a super patent, which would include the cost, social tax, and
retail trade tax would make the taxation process for individual entrepreneurs
simpler. We believe a simplified and more transparent system would have
a significant impact on improving the country’s business environment,”
said Dall’Olio, IFC Operations Officer.
Luc Moers, IMF Resident Representative, supported IFC’s recommendations
on SME taxation, noting that careful assessment of the impact on tax revenues
was needed. He also stressed that more attention should be given to reducing
tax arrears, which have increased in recent years, particularly those of
state-owned enterprises. Moers argued that tax committee resources should
be concentrated where the largest revenue gains can be achieved and that
resources allocated to inspectorates that generate minimal revenue should
be reduced. “Most of the difficulties we are discussing are caused by
the confusion about implementing the tax code and not by the code per se.
The top priority should be to develop the required supporting regulations
for proper implementation of the existing code,” he noted.
Additional recommendations from participants included consolidating taxes
to simplify process, combining the social and tax registration numbers,
conducting awareness campaigns about tax inspections, and increasing the
quality of such inspections.
About IFC
IFC, the private sector arm of the World Bank Group, promotes open and
competitive markets in developing countries. IFC supports sustainable private
sector companies and other partners in generating productive jobs and delivering
basic services, so that people have opportunities to escape poverty and
improve their lives. Through FY06, IFC Financial Products has committed
more than $56 billion in funding for private sector investments and mobilized
an additional $25 billion in syndications for 3,531 companies in 140 developing
countries. IFC Advisory Services and donor partners have provided more
than $1 billion in program support to build small enterprises, to accelerate
private participation in infrastructure, to improve the business-enabling
environment, to increase access to finance, and to strengthen environmental
and social sustainability. For more information, please visit www.ifc.org.
About IFC Business-Enabling Environment - SME Policy Project
Launched in 2003, the project is financed by Switzerland’s State Secretariat
for Economic Affairs. In addition to monitoring the business environment
by conducting regular surveys, the project is helping implement the new
inspections law, conducting preliminary analysis for the permits reform,
and raising awareness of small and medium enterprises through training
and events. For more information, please visit www.ifc.org/tajikistan/sme.
About IMF
The IMF works to foster global monetary cooperation, secure financial stability,
facilitate international trade, promote high employment and sustainable
economic growth, and reduce poverty. To maintain stability and prevent
crises in the international monetary system, the IMF reviews national,
regional, and global economic and financial developments. It provides advice
to its 185 member countries, encouraging them to adopt policies that foster
economic stability, reduce their vulnerability to economic and financial
crises, and raise living standards, serving as a forum where they can discuss
the national, regional, and global consequences of their policies. The
IMF also makes financing temporarily available to member countries to help
them address balance of payment problems—that is, when they find themselves
short of foreign exchange because their payments to other countries exceed
their foreign exchange earnings. The Fund also provides technical assistance
and training to help countries build the expertise and institutions they
need for economic stability and growth. For more information, please visit
www.imf.org/external/country/tjk/rr.
About SECO
The State Secretariat for Economic Affairs is the Swiss Confederation's
competence center for all the core issues related to economic policy. Its
aim is to create basic regulatory and economic policy conditions to enable
business to flourish and benefit all. SECO also represents Switzerland
in the large multilateral trade organizations and international negotiations,
and is involved in efforts to reduce poverty and help developing countries
with transition economies build sustainable democratic societies and viable
market economies. Each year, Switzerland spends about 1.9 billion francs
on development cooperation and transition assistance to countries.
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