Kazakhstanâs VAT Hike to 16% Sparks Fears Among Oil and Business Leaders
Kazakhstan will raise its value-added tax (VAT) from 12% to 16% starting in 2026. The change has sparked concerns among business owners, particularly in key industries like oil and gas. Asylbek Zhakiyev, Chairman of the countryâs Oil and Gas Council, recently spoke about the challenges ahead for entrepreneurs and the role of a newly formed coordination council in addressing them.
The VAT increase is set to take effect on January 1, 2026. Around the same time, stricter rules on cash withdrawals for businesses will also come into force, requiring formal reporting for large transactions. These measures have left many entrepreneurs uneasy about their financial operations.
Zhakiyev, who leads an association of 150 oil and gas companies employing 70,000 people, has highlighted the sectorâs struggles with taxation. The industry contributes nearly half of Kazakhstanâs budget revenue, making its stability critical. He has pointed to broader issues as well, including legislative hurdles, trade barriers, and the need for stronger support for small and medium-sized businesses. A coordination council for entrepreneurship development was recently established under the Amanat party, with Deputy Prime Minister Serik Zhumangarin at its helm. Zhakiyev expects this council to propose concrete solutions, such as improving tax administration and ensuring direct communication between industry groups and the government. However, no public statements have been made about specific actions or whether Zhakiyev has directly engaged with officials regarding the VAT hike or the councilâs plans.
The VAT rise and new cash withdrawal rules will bring significant changes for businesses in 2026. The oil and gas sector, along with other industries, will be watching closely for the coordination councilâs next steps. For now, entrepreneurs await clearer guidance on how these policies will be implemented and what support will be available.
