On measures to further improve the registration of taxpayers and simplify the procedure for VAT reimbursement (595-son)

22.09.2021

Resolution

of the Cabinet of Ministers of the Republic of Uzbekistan

In order to ensure the implementation of the Decree of the President of the Republic of Uzbekistan No. DP-6155 dated February 3, 2021 “On the State program for the implementation of the Action Strategy for the five priority areas of development of the Republic of Uzbekistan in 2017 — 2021 in the ʻYear of youth support and public health promotionʼ”, as well as to support the activities of disciplined taxpayers, improve the value added tax administration system by limiting the impact of the human factor, create equal competitive conditions for all business entities, and take preventive measures to restrict operations (transactions) with counterparties with a high level of tax risk, the Cabinet of Ministers resolves:

1. The following:

in accordance with the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No. 529 dated August 19, 2021 “On measures for the provision of information on taxpayers to third parties”, it is established that a system for providing information not constituting a tax secret and accounting data to legal entities and individuals shall be introduced;

in accordance with the Resolution of the President of the Republic of Uzbekistan No. RP-4389 dated July 10, 2019 “On additional measures to improve tax administration”, a value added tax payer shall be subject to mandatory special registration with the tax authorities in the established manner in order to acquire the right to offset the amount of value added tax on actually received goods (services);

it shall be taken into account that the liability measures provided for in Article 219 of the Tax Code of the Republic of Uzbekistan shall not be applied where applications for special registration of value added tax payers are submitted to the tax authorities in the established manner and within the prescribed time limits.

2. The following of the State tax committee of the Republic of Uzbekistan:

expanding the practice of applying a risk-based approach by introducing it into the procedures for special registration of value added tax payers with the tax authorities;

implementing the refund of the amount of value added tax subject to reimbursement to disciplined taxpayers in an accelerated procedure;

forming the list of disciplined taxpayers on the basis of a risk analysis program by the State tax committee of the Republic of Uzbekistan and publishing it on its official website.

3. It shall be established that:

a) in the special registration of value added tax payers with the tax authorities:

applications for special registration for value added tax shall be considered within seven days;

where the results of consideration of an application are not submitted to the value added tax payer by the tax authorities within the established period, a certificate of special registration shall be issued to such payer automatically;

b) starting from January 1, 2022:

agreements on lease (rent) or gratuitous use of immovable property concluded by legal entities shall be registered with the state tax service authorities. In this case, the registration of agreements on lease (rent) or gratuitous use of immovable property by individuals and legal entities in the electronic systems of the state tax service authorities shall be carried out remotely only in electronic form;

the balances of inventory items stored in immovable property objects leased or used free of charge under agreements not registered with the state tax service authorities shall not be subject to stocktaking (inventory) and shall be deemed not available in the warehouse of the taxpayer for tax purposes.

4. It shall be established that:

Public services centers shall allow the state registration or re-registration of legal entities only where, based on the database of the state cadastre, the immovable property belongs to the applicant, as well as where, based on the database of the tax authorities, a lease (rent) agreement or a gratuitous use agreement exists, and strict use of these databases shall be ensured;

when registering or re-registering a business entity through the Unified interactive state services portal of the Republic of Uzbekistan via the Internet, the applicant shall strictly use the tax and cadastre databases provided for in paragraph two of this clause in determining the place of business activity (except for legal entities whose applications for participation in special economic zones have been satisfied);

newly registered legal entities shall be registered on the basis of the initial agreement data on lease (rent) or gratuitous use of immovable property registered with the state tax service authorities. In this case, legal entities shall, within ten days from the date of state registration, register with the state tax service authorities the lease (rent) or gratuitous use agreement specified in the application or another such agreement, and failure to comply with this requirement shall serve as grounds for recognizing that the legal entity is not located at its declared place of location (postal address).

5. The following shall be approved:

а) the Regulation on the procedure for special registration of value added tax payers with the tax authorities in accordance with Annex 1, providing for:

the sequence and procedure of actions for the special registration of value added tax payers;

the list of value added tax payers subject to mandatory special registration in accordance with the requirements of the Tax Code of the Republic of Uzbekistan, including the time limits for submitting applications to the tax authorities for special registration of value added tax payers;

the list of value added tax payers subject to voluntary special registration in accordance with the requirements of the Tax Code of the Republic of Uzbekistan, including the time limits for submitting applications to the tax authorities for special registration of value added tax payers;

the procedure and time limits for considering applications for special registration of value added tax payers, as well as the procedure for classifying taxpayers into risk groups (high, medium and low level of tax risk) based on the results of information analysis;

the procedure and time limits for making a decision on special registration of a value added tax payer based on its classification into one of the tax risk groups;

the grounds and procedure for suspension, cancellation and termination of the validity of the certificate confirming the special registration of a value added tax payer issued by the tax authorities;

b) the Action Plan on practical measures for improving value added tax administration aimed at creating favorable conditions for disciplined taxpayers and supporting their activities with minimization of the human factor shall be approved in accordance with Annex 2.

6. The State tax committee of the Republic of Uzbekistan shall:

а) within one month:

establish, within the overall approved staffing level of the managerial personnel of the State tax committee, separate specialized structural units responsible for the analysis of tax risks in the special registration of value added tax payers, as well as for maintaining records of tax benefits;

submit to the Cabinet of Ministers the regulation on the provision of a state service for the mandatory registration with the tax authorities of agreements on lease (rent) or acquisition for lease, as well as agreements on gratuitous use of immovable property concluded by legal entities and individuals;

b) within two months, develop and put into operation the automated information system “E-aktiv” ensuring the accounting of the movement of fixed assets, intangible assets and inventory items;

c) within three months:

jointly with the Ministry of Finance of the Republic of Uzbekistan, submit to the Cabinet of Ministers a draft law on introducing amendments and additions to the Tax Code of the Republic of Uzbekistan, providing for the unification of the submission of reports on turnover tax and value added tax, as well as the deadlines for payment of taxes;

jointly with the Public services agency under the Ministry of Justice of the Republic of Uzbekistan, conduct a complete inventory of information on the founders (participants) of legal entities. In doing so, particular attention shall be paid to ensuring the full inclusion, in the central database, of data on personal identification numbers of legal entities, foreign legal entities carrying out activities through representative offices, branches or permanent establishments, as well as individuals engaged in entrepreneurial activities;

ensure that the special registration of value added tax payers with the tax authorities is carried out on the basis of a fully automated system with limited human involvement (except in cases established by legislation);

d) by December 1, 2021:

introduce into practice a service for automatic determination of the availability of products at the supplier when issuing electronic invoices, based on the Unified electronic national catalog of products (goods and services) approved by the Resolution of the Cabinet of Ministers No. 249 dated April 28, 2021. In this case, the list of products for which availability is automatically determined shall be established by the State tax committee, and where the absence of products to be sold at the supplier is identified, the possibility of issuing invoices for such sales shall be restricted;

introduce a procedure for creating a database on existing tax benefits and assigning a separate unique tax benefit code (ID number) for each tax benefit, as well as implement the practice of delivering information on tax benefit codes to the personal accounts of taxpayers.

7. The Ministry of Justice of the Republic of Uzbekistan shall:

ensure that information on the constituent documents of registered and newly registered business entities, as well as amendments thereto, is submitted in electronic form to the State tax committee of the Republic of Uzbekistan in real time starting from January 1, 2022;

by January 1, 2022, jointly with the State tax committee of the Republic of Uzbekistan and the Cadastre agency, ensure automated electronic exchange between the automated system of state registration and registration with the tax authorities of business entities and the databases on immovable property and leased property.

8. It shall be established that the expenses related to the development of the automated systems envisaged to be introduced by this Resolution shall be financed from the Special fund for Material assistance, social protection, development of tax authorities and unforeseen expenses of the State tax committee of the Republic of Uzbekistan.

9. Amendments and additions shall be introduced to certain resolutions of the Government of the Republic of Uzbekistan in accordance with Annex 3.

10. This Resolution shall enter into force upon the expiration of three months from the date of its official publication.

11. Control over the implementation of this Resolution shall be assigned to the Deputy Prime Minister of the Republic of Uzbekistan for financial and economic issues and poverty reduction — the Minister of economic development and poverty reduction, J.A. Kuchkarov, and the Chairman of the State tax committee of the Republic of Uzbekistan, Sh.D. Kudbiyev.

Prime Minister of the Republic of Uzbekistan A. ARIPOV

Tashkent,

September 22, 2021,

No. 595

ANNEX 1 to the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No.595 dated September 22, 2021

REGULATION

On the procedure for special registration of value added tax payers with the tax authorities

Chapter 1. General provisions

1. This Regulation establishes the procedure for special registration of value added tax payers with the tax authorities.

2. The following basic concepts are used in this Regulation:

“Interdepartmental software and hardware complex ʻUnified national labour system (hereinafter — the Unified national labour system)” — an organizationally arranged set of information resources, technologies and communication means used for the collection, storage and processing of information on registered employment contracts and the employment record (length of service) of employees;

cancelled certificates — certificates cancelled on the grounds and in the manner provided for in Chapter 9 of this Regulation;

certificate — an electronic document issued by the tax authority to a value added tax payer confirming its special registration and, in cases established by the acts of tax legislation, the right to offset value added tax;

Central database — the Central database of the State tax committee of the Republic of Uzbekistan (hereinafter — the State tax committee) on legal entities, foreign legal entities carrying out activities through representative offices, branches or permanent establishments, and individuals engaged in entrepreneurial activities, developed in accordance with the requirements of the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No. 539 dated September 4, 2020 “On measures to further improve the mechanisms for the collection, processing and storage of information on legal entities, foreign legal entities carrying out activities through representative offices, branches or permanent establishments, and individuals engaged in entrepreneurial activities;

value added tax payer — a person on whom the obligation to pay value added tax is imposed in accordance with the Tax Code of the Republic of Uzbekistan, regardless of whether such person is specially registered for value added tax or not;

special registration for value added tax — the sequence of actions for issuing or refusing to issue a certificate of special registration to value added tax payers based on the results of verification and analysis of tax risk;

terminated certificates — certificates the validity of which has been terminated on the grounds specified in Chapter 9 of this Regulation;

suspended certificates — certificates the validity of which has been suspended on the grounds specified in Chapter 8 of this Regulation;

active certificates — valid certificates confirming the special registration of taxpayers;

tax arrears — tax debt on value added tax not paid by a taxpayer for a period exceeding two months within the scope of the requirements of this Regulation.

3. Special registration for value added tax (hereinafter — special registration) shall be carried out by the state tax service authorities. For the purpose of special registration, value added tax payers shall submit an application to the state tax service authorities within the time limits established by the acts of legislation. In this case, taxpayers recognized as value added tax payers on a mandatory basis (except for budget and non-profit organizations) shall not be required to submit an application, and a certificate confirming their special registration as value added tax payers shall be issued to them automatically.

4. Value added tax by taxpayers with an active VAT certificate may be offset only in respect of goods (services) actually received, on the basis of invoices issued by suppliers that are duly specially registered with the tax authorities and possess an active certificate.

5. Value added tax payers not specially registered with the tax authorities shall pay value added tax without the right to offset it.

This requirement shall apply from the following dates:

from the date of state registration — for legal entities that have voluntarily chosen to pay value added tax;

from the first day of the month following the month in which the obligation arose — for persons whose total income from the realization of goods (services) during the tax period exceeds the amount specified in clause 1 of part one of Article 461 of the Tax Code;

from the moment the obligation arises — for taxpayers to whom the payment of turnover tax is not applied in accordance with Article 461 of the Tax Code.

6. Special registration of value added tax payers shall include the following sequence of actions:

submission by the taxpayer of an application for special registration to the tax authority;

identification of tax risks;

making a decision on special registration or refusal thereof;

assignment of an individual registration number to the value added tax payer (hereinafter — VAT number);

entry of information on the value added tax payer into the unified register of special registration;

generation of a certificate reflecting the individual registration number and its submission to the value added tax payer;

re-special registration of the value added tax payer in cases established by this Regulation.

7. Indication of the VAT number shall be mandatory when executing and using all types of documents related to:

settlements for the purchase and realization of goods (services), including invoices and transport documents;

payment of value added tax and (or) its offset and refund;

accounting and reporting on value added tax.

8. Special registration of a taxpayer shall be carried out on the basis of the results of consideration of an application in electronic form, drawn up in accordance with Annex 1 to this Regulation and submitted to the tax authorities through the taxpayerʼs personal account.

Chapter 2. Special registration of persons subject to mandatory value added tax payer status

9. In accordance with the requirements of the Tax Code, a certificate confirming special registration for value added tax shall be issued automatically to the following taxpayers without determining the level of tax risk:

taxpayers to whom the payment of turnover tax is not applied in accordance with Article 461 of the Tax Code;

foreign legal entities realizing goods (services) in the territory of the Republic of Uzbekistan, where the place of realization of such goods (services) is recognized as the Republic of Uzbekistan;

foreign legal entities carrying out activities in the Republic of Uzbekistan through permanent establishments.

In this case, the certificate provided for in this clause shall, at the request of a person being registered as a business entity — a legal entity, be issued simultaneously with the state registration of such business entity — a legal entity.

10. The activities of the business entities specified in clause 9 of this Regulation shall be monitored by the tax authorities, and the identification, in the course of such monitoring, of cases where the transactions (operations) carried out do not correspond to the nomenclature of goods (services) being purchased and realized shall constitute grounds for suspension of the validity of the certificate confirming special registration for value added tax.

Chapter 3. Voluntary special registration of taxpayers

11. In accordance with the requirements of the Tax Code of the Republic of Uzbekistan, the following persons shall be entitled to voluntary special registration:

legal entities that have voluntarily refused to pay turnover tax;

individual entrepreneurs whose income from the realization of goods (services) during the tax period exceeds one hundred million soums.

12. In cases of voluntary special registration, the application shall be submitted no later than seven working days prior to the beginning of the month from which the taxpayer transitions to payment of value added tax.

The application shall be submitted to the tax authority in electronic form through the taxpayerʼs personal account and shall be deemed accepted by the tax authority at the moment of its submission.

Chapter 4. Consideration of applications for special registration

13. The tax authority shall, within seven days from the date of receipt of an application for special registration of a value added tax payer, be entitled to carry out the following measures for the purpose of determining the level of tax risk:

study the identity of the head and founders (participants) of the taxpayer or the person performing financial management functions, with attention paid to the following: whether such person has previously been a head or founder of an organization declared bankrupt; whether such person has previously been held liable for deliberate tax evasion or has performed managerial or founding (participatory) functions in an organization classified as high risk; the officially declared income of the head; the availability in the Unified national labour system of employment contracts concluded with the persons indicated in the application; the availability of information on the founder (participant) in the database of the tax authority;

carry out a field visit to verify the actual location of the taxpayer at the address of state registration, as well as the actual existence of the specified address according to the data of the address reference bureau, except in cases where the taxpayer possesses immovable property on the basis of ownership rights;

examine the compliance of bank transactions and invoices with the type and specifics of the taxpayerʼs activity, as well as with the nomenclature of goods (services) being purchased and realized;

analyze the amounts of realization of goods (services), the submission of tax reports, and the balances of inventory items;

where the taxpayer does not possess its own immovable property, verify the existence of a lease (rent) agreement and its registration with the tax authority;

verify the existence of tax arrears of the taxpayer — a legal entity, as well as of its founders (participants) — legal entities, and also verify the existence of tax arrears and the submission of tax reports by other legal entities managed by the person acting as the head;

examine the availability of necessary production, trade and warehouse premises and areas, as well as other required material and technical resources, taking into account the type of activity of the taxpayer;

examine the address of the taxpayerʼs location, namely, whether the taxpayer is located at an address indicated by several taxpayers classified as high tax risk — a nominal address. In this case, an address shall be recognized as a nominal address where the average area used for administrative purposes (office) is less than eighteen square meters per one legal entity on the basis of ownership, lease (rent) or gratuitous use;

verify whether the taxpayer is in the process of liquidation or in other processes of reorganization, or whether such processes have been carried out;

examine the formation of the charter fund (charter capital).

The third, sixth, eighth and ninth paragraphs of this clause shall not apply to residents of the Technology park of software products and information technologies that have concluded a virtual office agreement with the Directorate of the Technology park of software products and information technologies.

14. During the consideration of the taxpayerʼs application, the Central database, the databases of the tax authorities, ministries, departments and local executive authorities, as well as the information submitted by taxpayers, shall be considered as sources of data subject to analysis.

15. Based on the results of verification and analysis of information, the taxpayer shall be classified into one of the following risk groups:

taxpayer with a high level of tax risk;

taxpayer with a medium level of tax risk;

taxpayer with a low level of tax risk.

16. For the purposes of this Regulation, the group of taxpayers with a high level of tax risk shall include taxpayers in respect of whom at least one of the following indicators is identified:

the identity of the head, as well as of the person performing managerial or financial management functions, is not established, or the employment contracts concluded with the persons indicated in the application are not confirmed in the Unified national labour system;

information on the founder (participant) is not available in the database of the tax authority;

the taxpayer is not present at the address of state registration;

in the absence of its own immovable property, the taxpayer does not possess leased or gratuitously used immovable property;

the address of the taxpayer is not available in the database of the address reference bureau;

the address of the taxpayer coincides with a nominal address;

the transactions (operations) carried out do not correspond to the type and specifics of the taxpayerʼs activity, as well as to the nomenclature of goods (services) being purchased and realized based on the analysis of invoices;

tax reports are not submitted;

at the time of submission of the application, the taxpayer has tax arrears, as well as where legal entities in which the founders (participants) hold a share of 50 percent or more have tax arrears. In this case, as an exception, the above shall not apply where there is a conclusion of the State tax committee confirming that such persons have suffered damage as a result of natural disasters, technological accidents or other force majeure circumstances, as well as where there has been a delay in their financing from the budget (state targeted funds) or a delay in payment for work performed and (or) services rendered under state orders, for state needs or for the needs of local public authorities;

where a taxpayer with tax arrears or a taxpayer classified as high tax risk is merged (joined) with the taxpayer;

where the head of the applicant taxpayer simultaneously acts as the head of another taxpayer (legal entity), and such taxpayer has tax arrears or has failed to submit tax reports. In this case, the existence of tax arrears shall be taken into account regardless of whether such arrears were incurred during the period when this person acted as the head, or whether tax reports have not been submitted since that period;

where managerial or founding (participatory) functions are carried out by a person who has previously been a head or founder (participant) of an organization declared bankrupt and who has previously been held liable as a head or founder (participant) for deliberate tax evasion. In this case, this requirement shall be taken into account only where the share of the founder (participant) is 50 percent or more;

where the license requirements related to the implementation or use of the national information system for product labeling and traceability “Asl Belgisi”, as well as the information system for accounting the volumes of production of consumer and technical ethyl alcohol, alcoholic beverages and tobacco products, and to ensuring the sale of consumer and technical ethyl alcohol by motor vehicles equipped with an automated real-time tracking system (GPS) and fitted with electronic meters integrated into the information system for accounting the volumes of production and turnover of consumer and technical ethyl alcohol, alcoholic beverages, as well as the unified register of vineyards, are violated;

where managerial or founding (participatory) functions are carried out by a person who belongs to the category of high risk and has been held liable for deliberate tax evasion. In this case, this requirement shall be taken into account only where the share of the founder (participant) is 50 percent or more.

The fourth through seventh paragraphs of this clause shall not apply to residents of the Technology park of software products and information technologies that have concluded a virtual office agreement with the Directorate of the Technology park of software products and information technologies.

17. For the purposes of this Regulation, the group of taxpayers with a medium level of tax risk shall include taxpayers in respect of whom at least one of the following indicators is identified:

cases of failure to submit tax reports within the established time limits during the last twelve months;

the number of employees or hired workers is less than 4 persons;

depending on the type of activity of the taxpayer, the absence of necessary production, trade and warehouse premises and areas, as well as other required material and technical resources;

at the time of submission of the application, the existence of balances of inventory items exceeding the amount specified in clause 1 of part one of Article 461 of the Tax Code;

the absence of electronic meters of finished products equipped with appropriate protection means on all production lines for consumer and technical ethyl alcohol and bottling lines of alcoholic products, ensuring cumulative accounting data indicators;

failure by organizations to ensure, on a continuous basis, the following minimum amount of the charter fund:

for organizations producing consumer ethyl alcohol and vodka — 10,000 times the base calculation amount;

for other producers of alcoholic products (except for primary processing organizations of grapes and fruits) — 1,000 times the base calculation amount;

where, for organizations producing vodka and liqueur-vodka products from consumer ethyl alcohol (except for grape and fruit ethyl alcohol), the available annual production capacities are less than 60 percent of the installed capacities and the annual production volume is less than 100 thousand decaliters in terms of absolute alcohol;

where, for organizations not producing vodka, the available annual production capacities for liqueur-vodka products from consumer ethyl alcohol (except for grape and fruit ethyl alcohol) are less than 50 percent of the installed capacities.

18. For the purposes of this Regulation, taxpayers in respect of whom no indicators for classification into the groups of taxpayers with a high or medium level of tax risk are identified shall be classified as taxpayers with a low level of tax risk.

Chapter 5. Making a decision on special registration

20. Based on the classification of a taxpayer into one of the tax risk groups, the tax authority shall, within two working days after completion of consideration of the application and verification and analysis of the data contained therein, adopt a decision providing for:

in respect of taxpayers with a high level of tax risk — refusal of special registration;

in respect of taxpayers with a medium level of tax risk — special registration subject to conducting tax control measures within the subsequent twelve months;

in respect of taxpayers with a low level of tax risk — special registration.

21. A decision on special registration of value added tax payers with the tax authorities shall be made by the head (deputy head) of the tax authority.

Where an application for special registration of value added tax payers with the tax authorities is submitted within the time limits established in clause 12 of this Regulation, as well as where the amounts of realization of goods (services) exceed the amount specified in clause 1 of part one of Article 461 of the Tax Code, the taxpayer shall be deemed specially registered from the first day of the month following the month in which the application was submitted.

In this case, where an application for special registration of value added tax payers with the tax authorities is submitted within the time limits established in clause 10 of this Regulation, taxpayers to whom the payment of turnover tax is not applied in accordance with Article 461 of the Tax Code shall be deemed specially registered from the date on which the obligation to pay value added tax arises.

22. With respect to a taxpayer classified as having a medium level of tax risk, the tax authority shall, after special registration, carry out tax control measures in accordance with the procedure established by the acts of legislation (inspection, inquiry, cameral and field tax audits, as well as control over the compliance of the number of employees with the reported and actual number).

23. A copy of the reasoned decision on special registration or refusal thereof shall be sent to the taxpayerʼs personal account within one working day from the date of its adoption.

24. A taxpayer whose special registration has been refused shall, after eliminating the circumstances that led to the refusal, have the right to submit a new application or to appeal the decision on refusal to a higher tax authority or to a court.

Chapter 6. Re-special registration of value added tax payers

25. In the event of a change in the name of a legal entity or in the surname, name or patronymic of an individual entrepreneur, the value added tax payer shall be subject to re-special registration.

Re-special registration of a value added tax payer shall not result in a change of the value added tax number and shall not affect the calculation of value added tax by the taxpayer and its counterparties.

26. Re-special registration of value added tax payers shall be carried out automatically by making amendments to the database of the tax authorities on the basis of information received from the Ministry of Justice of the Republic of Uzbekistan.

Chapter 7. Grounds and procedure for deregistration from special registration

27. Deregistration from special registration shall be carried out in the following cases:

taxpayers that have voluntarily transitioned to the payment of value added tax shall, provided that the amounts of realization of goods (services) for the current tax period do not exceed the amount specified in clause 1 of part one of Article 461 of the Tax Code, have the right to re-transition to the payment of turnover tax not earlier than after twelve months;

where a value added tax payer — a legal entity is liquidated;

where the activity of an individual entrepreneur who is a value added tax payer is terminated.

28. Deregistration from special registration shall be carried out in accordance with a decision of the tax authority adopted on the basis of:

an application of the taxpayer for voluntary deregistration from special registration submitted to the tax authority in the form in accordance with Annex 2 to this Regulation;

information on the exclusion of the business entity from the Unified State Register of Business Entities in connection with its liquidation;

documents confirming the termination of individual entrepreneurial activity.

29. A taxpayer shall cease to be a value added tax payer from:

the beginning of the calendar year, on the basis of a notification submitted to the tax authority no later than ten working days prior to the beginning of the calendar year from which the legal entity transitions to the payment of turnover tax;

the date of exclusion from the unified state register of business entities;

the date of termination of individual entrepreneurial activity.

30. A decision on deregistration from special registration for value added tax shall be made by the head (deputy head) of the tax authority, and the status of the certificate shall be changed to terminated in the register of value added tax payers.

Chapter 8. Grounds and procedure for suspension of the validity of the certificate

31. A decision on suspension of the validity of the certificate may be adopted by the tax authority for a period not exceeding thirty days where cases are identified in which the transactions (operations) carried out do not correspond to the nomenclature of goods (services) being purchased and realized. A decision on suspension of the validity of the certificate for a period exceeding thirty days may be adopted by a court on the basis of an application of the tax authority submitted in electronic form.

Where, based on the results of cameral and field tax audits, the circumstances specified in paragraph one of this clause are not confirmed, the validity of the certificate shall be restored.

32. Suspension of the validity of the certificate shall be carried out automatically on a daily basis, and an automatic notification thereof shall be ensured to be sent to the taxpayerʼs personal account. In this case, the information available in the databases of the tax authorities shall be analyzed automatically on a daily basis, and where the circumstances specified in this Chapter are identified, the validity of the certificate shall be suspended automatically.

33. Information on taxpayers whose certificates have been suspended shall be posted on the official website of the State tax committee.

34. A taxpayer whose certificate has been suspended shall have the right to appeal such decision (notification) to a higher tax authority or to a court in accordance with the procedure established in Article 231 of the Tax Code.

After elimination of the circumstances that served as the grounds for suspension of the validity of the certificate and upon reflection of such changes in the databases, the tax authority shall ensure automatic restoration of the validity of the certificate within one day.

No adjustments shall be made to the amounts of value added tax offset in respect of goods (services) actually received or imported prior to the adoption by the tax authority of a decision on suspension of the validity of the certificate.

Chapter 9. Grounds and procedure for cancellation and termination of the validity of the certificate

35. A decision on cancellation of the certificate may be adopted by the tax authority on the following grounds established by a court:

the certificate has been issued on the basis of submission by the taxpayer of invalid or forged documents;

during a tax audit, bank transactions are found not to correspond to the type and specifics of the activity of the business entity, as well as to the nomenclature of goods (services) being purchased and realized;

during a tax audit, it is established that the main purpose of concluding a transaction by the taxpayer was to evade payment of value added tax or to provide another person with the opportunity to unjustifiably offset value added tax, as well as that obligations under the transaction (operation) were performed by a person who is not a party to the contract or by a person on whom the obligation to perform the transaction (operation) is not imposed by the contract or by law;

the taxpayer is recognized as having engaged in fictitious entrepreneurship.

36. A decision on cancellation of the certificate shall be made by the head (deputy head) of the tax authority. In this case, the certificate shall be deemed cancelled from the date of its issuance.

37. A decision on termination of the validity of the certificate may be adopted by the tax authority in the following cases:

where a suspended certificate has not been restored by the taxpayer for a period exceeding nine months;

where the taxpayer is deregistered from special registration for value added tax in accordance with the procedure provided for in Chapter 7 of this Regulation.

A decision on termination of the validity of the certificate may also be adopted by the tax authority on the basis of an application of the taxpayer for voluntary deregistration from special registration, submitted in electronic form in accordance with Annex 2 to this Regulation, in respect of taxpayers whose total income during the tax period has exceeded one billion soums as a result of an error and who have been issued a value added tax certificate. In this case, the decision on termination of the certificate shall be made by the head (deputy head) of the tax authority, and the certificate shall be deemed terminated from the date of its issuance.

38. Information on persons whose certificates have been cancelled or terminated shall be posted on the official website of the State tax committee.

39. A taxpayer whose certificate has been cancelled or terminated shall have the right to appeal such decision to a higher tax authority or to a court.

Chapter 10. Procedure for formation of the certificate

40. The State tax committee shall, upon special registration, form a certificate in the form in accordance with Annex 3 to this Regulation.

41. The certificate shall be formed in electronic form no later than one working day from the date of adoption of the decision on special registration of the taxpayer.

42. The certificate in electronic form shall be sent to the taxpayerʼs personal account on the date of adoption of the decision on special registration.

Where value added tax payers are re-specially registered in accordance with the procedure provided for in Chapter 6 of this Regulation, the certificate in electronic form shall be sent to the taxpayerʼs personal account on the date of such re-special registration.

43. Special registration, formation of the certificate, suspension, termination and cancellation of its validity shall be carried out in accordance with the scheme provided for in Annex 4 to this Regulation.

Chapter 11. Register of value added tax payers

44. For the purpose of ensuring unified accounting of value added tax payers that have undergone special registration, an automated register (hereinafter — the Register) shall be formed.

45. The following information shall be entered into the Register:

identification data: value added tax number; for legal entities — name; for individual entrepreneurs — surname, name and patronymic;

data on special registration: information on registration, re-registration and cancellation of registration of value added tax payers;

informative data: information specified in the application for special registration — location (postal address) of the value added tax payer, information on the surname, name and patronymic of the head of the value added tax payer — a legal entity;

status of the certificate: active, suspended, terminated or cancelled.

46. Formation and maintenance of the Register shall be carried out by the State tax committee as follows:

develop organizational and methodological principles for maintaining the Register;

organize special registration;

assign a VAT number to taxpayers;

develop technologies and software and technical means for maintaining the Register;

perform the functions of administrator of the Register database, including collection and analysis of data, control over the reliability and relevance of data, their storage, protection, and control over access rights;

ensure that the Register database is maintained in an automated manner;

classify issued certificates into active, suspended, cancelled and terminated categories;

develop regulatory documents on the creation, maintenance and use of Register data;

ensure free access to the Register data.

Information on the classification of certificates in the Register shall be updated on a daily basis on the basis of changes in the databases of the tax authorities.

Chapter 12. Final provisions

47. Where the tax authorities, including the Central database, possess information for verifying and analyzing the data submitted by taxpayers for special registration, such verification and analysis shall be carried out in an automated mode without direct interaction with the taxpayer.

Where the information necessary for verification and analysis of the data submitted to the tax authorities is not available, the tax authorities shall have the right to request such information from the taxpayer and to conduct analysis on the basis thereof.

In addition, verification of the actual location of the taxpayer at the address of state special registration, as well as field tax audits, shall be carried out by the tax authorities through visits to the place where the taxpayerʼs activities are carried out.

48. The State tax committee may introduce amendments and additions to the tax risk indicators (circumstances) analyzed for the purpose of adopting decisions on issuance, suspension, termination or cancellation of the certificate provided for in this Regulation, and determine their threshold values on the basis of an order of the State tax committee.

49. The Register, as well as the list of persons and nominal addresses specified in paragraphs thirteen and fourteen of clause 16 of this Regulation, shall be formed by the State tax committee and posted on the official website of the State tax committee of the Republic of Uzbekistan.

50. Value added tax payers shall be liable for violation of the procedure for special registration.

51. The tax authorities shall exercise control over the timely special registration of value added tax payers in accordance with this Regulation.

52. Officials of the tax authorities shall be held liable in accordance with the procedure established by the legislation of the Republic of Uzbekistan for:

failure to perform or improper performance of their duties in conducting the control measures provided for in this Regulation;

non-compliance with the requirements of this Regulation and other acts of legislation of the Republic of Uzbekistan;

causing material and moral damage to individuals and legal entities as a result of unlawful actions (inaction);

adoption of decisions not in compliance with the legislation of the Republic of Uzbekistan.

53. The State tax committee shall, on a continuous basis, carry out systematic monitoring and control over the proper performance by the tax authorities of the obligations provided for in this Regulation.

ANNEX 1 To the Regulation on the procedure for special registration of value added tax payers with the tax authorities

APPLICATION

for special registration for value added tax

INFORMATION

on the value added tax payer

Note. This application shall be submitted in electronic form to the tax authority at the place of tax registration through the taxpayerʼs personal account.

ANNEX 2 to the Regulation on the procedure for special registration of value added tax payers with the tax authorities for value added tax

APPLICATION

for removal from special registration for value added tax

INFORMATION

ON THE VALUE ADDED TAX PAYER

Note. This application shall be submitted in electronic form to the tax authority at the place of tax registration through the taxpayerʼs personal account.

ANNEX 3 to the Regulation on the procedure for special registration of value added tax payers with the tax authorities for value added tax

STATE TAX COMMITTEE OF THE REPUBLIC OF UZBEKISTAN CERTIFICATE on special registration for value added tax

ANNEX 4 to the Regulation on the procedure for special registration of value added tax payers with the tax authorities for value added tax

Scheme

of special registration of value added tax payers for value added tax, issuance of the certificate, its suspension, termination and cancellation

ANNEX 2 To the Resolution of the Cabinet of Ministers of the Republic of Uzbekistan No. 595 dated September 22, 2021

ACTION PLAN

On practical measures for improving value added tax administration