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IBC proposes anti-crisis economic measures to mitigate the COVID-19 spread

March 20, 2020

The International Business Council (IBC) has developed a list of proposals for inclusion in the Government’s Action Plan of priority measures to minimize the negative consequences, risks and threats to economic security in response to the coronavirus spread.

IBC has submitted its recommendations to the Country’s Office on the implementation of economic measures aimed at minimizing the impact of external shocks and stimulating economic development, headed by Deputy Prime Minister of the Kyrgyz Republic Erkin Asrandiev.

The recommendations from business representatives and industry business associations include the following measures:

1. Consider delaying the introduction of a mandatory transition to electronic invoices for all VAT taxpayers until the epidemiological situation improves and existing deficiencies in the e-invoice system are eliminated.

2. Postpone the deadline for submitting a Single Tax Return for individual entrepreneurs.

3. Postpone the implementation of mandatory labeling of goods with identification marks when they are manufactured or imported into the territory of the Kyrgyz Republic.

4. Suspend tax inspections of business entities, with the exception of the inspections necessary to protect the life and health of the population.

5. Extend the period for Kyrgyz joint-stock companies regarding the obligation to hold a general meeting of shareholders until July 1, 2020.

6. Postpone deadlines for paying taxes paid quarterly.

7. Temporarily cancel the collection of overdue fees on tax obligations, non-tax and customs payments, state social insurance contributions and fines for late submission of tax and other reports.

8. Extend visas for foreign employees of enterprises and lift sanctions for non-compliance with the country's visa legislation until the epidemiological situation stabilizes.

9. Grant the right to defer tax and mandatory payments for business entities in the field of tourism, air transportation, hotel and restaurant business, shopping centers, and in other areas where there is a significant decline in activity. In particular, it is recommended:

- introduce a deferment of property tax payments until the 4th quarter of 2020;

- introduce a VAT exemption for 3 months from March 2020;

- introduce a turnover tax exemption for 3 months from March 2020;

- introduce a delay in payments on credit interest for 6 months from March 2020;

- introduce a deferral of tax payments on a contract basis for 3 months from March 2020;

- consider options for allocating concessional financing for the resumption of commercial activities following the stabilization of the situation;

- introduce a deferral of rental payments of state land plots and premises;

- recommend to private owners of land plots and premises to provide benefits for the payment of rent by entrepreneurs who have suffered as a result of force majeure circumstances.

10. Consider the possibility of deferring innovations dated February 12, 2020 to the Procedure for the export and import of ores, concentrates and wastes containing precious metals and related recoverable metals into the Kyrgyz Republic, in terms of additional requirements of ISO / IEC 17020 standards for accreditation of inspection companies engaged in the selection and testing of selected samples.

11. As part of the measures to introduce an increased readiness regime to prevent the spread of coronavirus infection, not to apply measures providing for a complete halt to the activities of logistics companies engaged in the transportation of goods.

12. If it is necessary to completely suspend the activities of some enterprises by decision of the Government of the Kyrgyz Republic, exempt such enterprises from tax and other mandatory payments to the budget for the period of suspension of their activity.

13. Consider the possibility of issuing permits for the entry of certain foreign citizens necessary for the production activities of enterprises (for example, the managerial level), provided that the entry of such persons does not pose a danger to the population and the epidemiological situation in the Kyrgyz Republic.

14. In order to protect domestic producers of consumer goods, to prescribe organized retail chains in the Kyrgyz Republic to exclude penalties for suppliers producing goods in the country, “entry fees” (placement on shelves), reduce retro bonuses to 5-7%, and coordinate advertising costs with suppliers.

15. Provide the ability to remotely issue licensing permits and provide government services to entrepreneurs.

16. Simplify the procedures for recognizing the situation related to the spread of the new coronavirus infection as force majeure circumstances for certain types of transactions, for example, state contracts and procurements.

17. Provide the business community and the general public with information on the possible needs of the Government of the Kyrgyz Republic (including Country’s Offices) for the mobilization of resources of the business community and the provision of assistance to the Government.