Mon 07 2020 11:36:14

Tashkent, Uzbekistan (UzDaily.com) -- On 27 July, President of the Republic of Uzbekistan Shavkat Mirziyoyev held a meeting to discuss ongoing work to reduce the shadow economy.

Our country has a high level of shadow economy. Therefore, in recent years, measures have been taken to reduce the share of the shadow economy by making it easier to do business. In particular, the foreign exchange market was liberalized, a new tax system was introduced, and about 100 permitting and licensing procedures were reduced. As a result, the share of the informal sector in industry has dropped from 20 percent to 6 percent over the past 5 years.

At the meeting, the work carried out in this direction was discussed, further tasks were determined. It was instructed to develop, with the involvement of experts from international organizations, a strategy to reduce the shadow economy.

The head of state emphasized the importance of observing caution in countering the shadow economy, so as not to harm economic activity, to work in this direction together with business and the public.

The task is to consistently continue tax reforms and introduce a system that would exclude shadow activities.

An instruction was given to develop the system "Conscientious taxpayer" and to test it to the end in the city of Tashkent.

Particular attention was paid to clearing corruption in the sphere of public procurement and investment projects. In order to ensure transparency in these areas, strengthen public control and competition, the Ministry of Finance was instructed to launch an information portal of public procurement.

It has been determined that from now on, each project will undergo an anti-corruption expertise. The task has been set to apply this procedure from 2021 to all projects implemented using centralized funds.

A system of compliance control against the shadow economy and corruption is also being introduced in government bodies. This work has begun, in particular, in the ministries of construction, health, higher and secondary specialized education, joint stock companies Uzbekneftegaz and Uzkimyosanoat. It was noted that by the end of the year this system should be introduced in 14 more organizations and 10 banks with a state share.

Instructions were given to develop "road maps" to combat corruption in the context of spheres and directions, to prevent corruption in the field of public procurement and investment projects.

Instructed to develop a methodology for calculating the rating of corruption and the shadow economy for government agencies, enterprises and regions. From 2021, the results of this rating will be announced with an assessment of the personal responsibility of all managers.

The issues of customs and tax system were also considered.

The need to eliminate the human factor in the customs system, strengthen customs control over cases of smuggling and artificially lower the customs value of goods is indicated.

The State Customs Committee and the State Tax Committee were instructed to create a unified database on the import, customs clearance and sale of imported goods. The task was set to introduce the information system "Customs Audit" from January 1, 2021.

The President stressed that in order to reduce the shadow economy, it is necessary to help people work legally, to interest them in this.

For example, as a result of the simplification of the self-employment system, in July alone, 184,000 citizens began working in the formal sector.

However, the level of informal employment in construction, trade and public catering, transport and other services is still high. Overall, only 4.9 million of the 13.5 million people employed in the economy pay income tax.

The meeting noted the need for targeted work in these areas, withdrawing informal actors from the shadow economy through the use of incentive mechanisms. It is proposed not to include payments through plastic cards and other types of contactless payments in the taxable base when calculating the turnover tax of entities operating in the spheres of trade, public catering, transport and consumer services.

The head of state noted the need to simplify tax administration for small businesses, further reduce the permit and licensing procedures for entrepreneurial activity.

For example, it is possible to reduce 100 types of licenses and 34 types of permits with their transfer to a notification procedure, to simplify a number of procedures, to halve the time for issuing 14 types of documents. Thanks to these measures, entrepreneurs can save 125 billion soums a year.

In addition, instructions were given to critically examine the 270 control functions of 43 agencies and reduce their powers that contribute to the risks of the shadow economy and corruption.

At the same time, the need to strengthen the responsibility of unscrupulous entrepreneurs involved in corruption and shadow schemes was emphasized.

A weak level of analysis of the shadow economy by industries and spheres was stated. In this regard, it is indicated that it is necessary to maintain statistics of the shadow economy in each area with the involvement of international experts.

The main force in fighting corruption and the shadow economy is business and the public. Therefore, it is important to form an intolerant attitude towards these negative phenomena in society, to cover their consequences in the media and through social networks.

- The fight against the shadow economy does not mean punishing entrepreneurs, hindering their activities. This is especially important during a pandemic. It is necessary to take strict measures against everyday corruption, strengthening public control at the local level, - said Shavkat Mirziyoyev.

Each ministry and industry is tasked with achieving specific indicators (KPI) by the end of the year as part of the implementation of the measures identified at the meeting.