Economic news in brief

President Nursultan Nazarbayev of Kazakhstan signed a law on amendments and additions to the national Tax Code on Dec. 5. The law includes provisions implementing the concept of a new budget policy in terms of strengthening the fiscal function of individual taxes for the taxation of luxury goods (an excise tax on tobacco and alcohol, a tax on transport and property), and the Advisory Council decisions on taxation. In order to discourage people from consuming harmful products, the plan includes increased excise taxes on spirits. Rate increases for low alcohol products are expected to be debated in 2014. For strong alcoholic beverages, it is proposed to increase excise tax rates in 2014 from 500 (US$3.24) to 1,000 ($US6.48) tenge, in 2015 – to 1,200 tenge ($US7.78) and in 2016 – to 1,600 tenge (US$10.37). In order to further increase excise duties on cigarettes, the law mandates that in 2015, excise tax be increased from 3,000 (US$19.45) to 3,900 (US$25.28) tenge, and in 2016 – from 3,900 (US$29.28) to 5,000 tenge (US$32.41) or 30 percent annually. In regards to taxes on cars, a rate on cars with an engine capacity between 4,000 to 5,000 cubic centimeters will be raised to 130 Monthly Calculated Indices (MCI), for car engine volume larger than 5,000 cubic centimeters to 200 MCIs. New tax rates will apply to vehicles that were purchased on or after January 1, 2014. Previously purchased cars will retain their old tax rates.

Speaking at a Dec. 6 media briefing at the CCS, the Akim (Governor) of North Kazakhstan, Samat Yeskendirov discussed the condition of the region’s highways. “This year, 4.5 billion tenge (US$29.2 million) was allocated for the repair of secondary roads, which is two times more than in the previous year. Of that amount, 2.6 billion tenge (US$16.9 million) was drawn from the local budget. In total, 12.4 billion tenge (US$80.4 million) was spent on reconstruction, maintenance, highway repair and secondary roads in 2013,” the akim informed. According to Yeskendirov, improving the state of roads is a regional development priority. “A sum of 780 million tenge (US$5.06 million) was allocated to the reconstruction, maintenance and repair of roads covered by the Employment Road Map 2020. These funds were used to repair and reconstruct district roads,” he stated.

An assembly-and-testing facility for space vehicles set to open in Astana in 2015 will profit from the assembly of satellites and their components, Novosti-Kazakhstan reported on Dec. 3, citing Vice Chairman of the National Space Agency, Meirbek Moldabekov. “Kazakhstan-made parts and labour will account for 55 percent of satellite production […] if a satellite is estimated at US$100 million, Kazakhstan will produce parts and labour worth US$50 million,” he said. “This facility will be the first of its type in the CIS […] the factory will be producing satellites not only for Kazakhstan, some of them will be sold to other nations,” he elaborated. According to him, the project consists of an assembly facility and a design office and will enable the design of satellites, the production of certain satellite components, satellite assembly and satellite  testing.

Kazakhstan has entered the top 20 nations in regards to the inflow of foreign investments, Tengri News reported, citing Kairat Karmanov, Vice Chairman of the Kaznex Invest (National Agency for Exports and Investments) Board. According to data announced at a recent UN conference on trade and development, Kazakhstan was ranked 19th in FDI inflow in 2012. The top three destinations of foreign investments are the USA, China and Hong Kong. “In the first H1 2013, the gross inflow of FDI into processing industries made up US$1.6 billion, 5.2 percent more than the same period of 2012,” he said at a press-conference. According to him, in 2012, the gross inflow of FDI to Kazakhstan reached a record high of US$28.8 billion. The inflow to the country’s metallurgy and finished metal production sphere grew by 16 percent to US$1.3 billion. Investments in the production of foodstuffs, drinks and tobacco products reached US$234 million.