OECD recognizes that AIFC’s tax regime meets global standards for tax transparency

NUR-SULTAN – The Organization for Economic Co-operation and Development (OECD) announced that the tax regime of the Astana International Financial Center (AIFC) meets global standards for tax transparency in its recent report.

“The introduction of substantial presence requirements and the resulting OECD recognition lays the foundation for the development of a comprehensive and more transparent financial services market. The legislative requirements will minimize the spread of shell companies for tax evasion purposes, which will positively affect the overall quality of the developing domestic market,” the AIFC press service reported.

According to the statement, base erosion and profit shifting (BEPS) practices cost countries $100-240 billion in lost revenue annually, equivalent to 4-10% of global revenue corporate tax. This is the result of the abuse of loopholes and inconsistencies between the tax systems of different countries.

The OECD and G20 member countries created the Inclusive Framework on Base Erosion and Profit Shifting in 2016. As a result, more than 135 countries and jurisdictions are implementing 15 actions to tackle base erosion. tax evasion, improve the consistency of international tax rules, ensure more transparent taxation. the environment and solve tax problems related to the digitalisation of the economy.

One of the OECD’s recommendations was to implement substantial presence requirements for Kazakhstan to comply with BEPS. In 2021, the Astana Financial Services Authority and the Ministry of Finance adopted the Rules on the Substantial Presence of AIFC Participants Applying Tax Exemptions for the Payment of Corporation Tax and Tax on added value. AIFC participants benefiting from tax advantages for the payment of corporation tax and value added tax must confirm their attendance in the AIFC.

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