Why Kyrgyzstan in 2025?
Kyrgyzstan continues to attract entrepreneurs from the CIS and beyond thanks to its flexible tax system and minimal bureaucracy. One of the key tools for small and medium-sized businesses is the Unified Tax — a simplified regime that replaces multiple taxes and reduces the overall burden on entrepreneurs.
What is the Unified Tax?
The Unified Tax is a simplified taxation system designed for small and medium-sized businesses in Kyrgyzstan. It replaces:
- Profit Tax (10%)
- Sales Tax (1–5%)
- VAT (12%)
The tax is calculated based on turnover rather than profit, which simplifies accounting and makes it particularly attractive for high-margin businesses such as IT, services, and retail trade. The regime is especially popular among freelancers and companies registered in the High-Tech Park (HTP) or the Creative Industries Park (CIP).
Who Can Use the Unified Tax?
Eligible categories:
- Individual Entrepreneurs (IE): Kyrgyz citizens and non-residents.
- Legal Entities (LLC/OsOO): Companies not subject to VAT.
- HTP residents: IT companies in Kyrgyzstan engaged in software development, blockchain, or e-sports.
- CIP residents: Businesses in design, marketing, media, fashion, and creative industries.
Restrictions — not available for:
- VAT payers (turnover over 30 million KGS).
- Financial and insurance companies.
- Producers of excisable goods (alcohol, tobacco).
- Lotteries, investment funds, and stock market participants.
Unified Tax Rates in 2025
For IE and LLCs:
- Retail trade:
- 4% (cash payments)
- 2% (non-cash, bank cards, transfers)
- Services and production:
- 6% (cash)
- 3% (non-cash)
- Catering, saunas, billiards: 8% (all payment methods)
- Markets & mini-markets: 0.1% for turnover up to 100 million KGS (~$1.17M)
- Small business (turnover up to 8M KGS, ~$94,000):
- 0% if using an online-enabled cash register (KCM) and paying social contributions (up to 2 employees).
High-Tech Park (HTP):
- IT services, software, blockchain: 1%
- E-commerce (digital products, licenses): 1%
Creative Industries Park (CIP):
- 1% until end of 2026
- 2% from Jan 1, 2027
Taxi & couriers:
- 1% personal income tax via tax agents (e.g., Yandex Go, Glovo).
How to Switch to Unified Tax
- Submit application Form STI-163 to the tax office by the end of the current month. The regime starts from the 1st of the following month.
- Install an online-enabled KCM (mandatory for small businesses).
- Keep separate records if combining activities (e.g., trade and services).
- Pay social contributions: 6% of the average salary for IE with income (~2000 KGS, ~$23/month).
Key point: Since 2023, the 30M KGS revenue cap was abolished for most activities, making the regime accessible regardless of turnover (except for VAT payers).
Reporting & Deadlines
- Quarterly: Unified tax declaration submitted by the 20th of the month following the quarter (e.g., Jan–Mar → by April 20). Tax paid by the same date.
- Small business (≤ 8M KGS): Exempt from declarations if using KCM.
- Annual: Statistical report (production, services, employment) — due by March 1 of the next year.
- Platform: Online filing via taxpayer portal cabinet.salyk.kg.
- Penalties: Late declaration — 1000 KGS ($12) for IE, 5000 KGS ($58) for LLCs.
Advantages of Unified Tax
- Simple calculation: Based only on turnover.
- Low rates: 0–6%, lower than 10% profit tax and 12% VAT under general system.
- VAT exemption: Up to 30M KGS turnover.
- Available to foreigners: Non-residents pay the same rates.
- IT benefits: HTP (1–2%) and CIP (1–2%) highly favorable for freelancers and studios.
- Flexibility: No strict turnover limits, suitable for scaling businesses.
Limitations & Risks
- Personal liability: IE are liable with all personal assets.
- Mandatory KCM: Required for 0% rates.
- Activity restrictions: Financial services, excisable goods, lotteries excluded.
- Social contributions: 6% even at minimal profits.
- Patent cancellation: Trade patents abolished in 2024; construction patents abolished from July 2025 — forcing transition to Unified Tax.
What’s New in 2025?
- Construction patents abolished (July 1, 2025) → switch to unified tax (4–6%) or general regime.
- Taxi & couriers: 1% income tax via aggregators replaces patents.
- CIP: 1% until 2026, rising to 2% in 2027.
- Product legalization: Until April 1, 2025 entrepreneurs may register goods without primary docs penalty-free.
- Debt amnesty: Individuals engaged in car re-export (2022–2025) exempt from debts and penalties.
- Jewelry tax reduced to 0.25%.
Comparison with Neighboring Countries
- Georgia: Small business pays 1% up to 500,000 GEL (~$185,000/year), stricter activity limits. Kyrgyzstan wins due to no turnover cap.
- Armenia: Turnover tax 10% (1% for certified IT) within $300,000/year.
- Kazakhstan: Simplified regime 3% (or 6% with expenses) capped at 94M KZT (~$180,000).
- Kyrgyzstan offers better conditions with no turnover limit and lower IT rates.
Practical Recommendations
- Plan ahead: Apply before month-end to start next month.
- Join HTP/CIP: IT and creative businesses benefit from 1–2% rates.
- Install KCM: Mandatory for 0% rate.
- Hire an accountant: ~$50–100/month to save time and avoid fines.
- Consider DTA: Kyrgyzstan has treaties with 30+ countries to avoid double taxation.
- Stay updated: Check sti.gov.kg for news.
Conclusion
The Unified Tax in Kyrgyzstan in 2025 is a convenient and beneficial regime for small and medium-sized businesses, especially in IT and creative industries. With rates from 0% to 6%, no turnover limits, and simplified reporting, it is ideal for freelancers, developers, and entrepreneurs. Businesses can register as IE or LLC in Kyrgyzstan remotely and apply for HTP or CIP residency to secure additional benefits (1–2%).
Still, entrepreneurs must account for social contributions, mandatory cash registers, and compliance with CRS. For a smooth start, hire an accountant, register properly, and confirm eligibility for your activity.