FDI Incentives

Invest in Kazakhstan

Kazakhstan’s Investment Code guarantees foreign firms equality between local and foreign investors, protection of investor’s rights, arbitration of disputes, guarantees against nationalization and the right to repatriate profits.

Kazakhstan ranks 22nd in the Investor Protection Index of the World Bank.

Kazakhstan has institutions to promote and support investment, including KazNexInvest and the Foreign Investors’ Council, and now plans to establish a new role of an investment ombudsman to help facilitate communication between investors and the government and help investors address their issues. In recent years, the government has also used joint ventures as an effective instrument to bring in foreign expertize and capital it needs to co-fund industries such as construction, logistics, petrochemicals, manufacturing and IT.

Incentives for Priority Projects

Kazakhstan has established a highly preferential regime for those investment projects classified as “priority investment projects”. The primary criterion for a Project is investment of not less than approx. USD 20 million in one of the areas specified by the Government.

Those who invest in Kazakhstan and conclude an investment contract for a Project with the authorized body (currently the Investments Committee under the Ministry of Industry and New Technologies), may enjoy the following advantages (as specifically set out in an investment contract):

1) exemption from corporate income tax (20%) for up to 10 years;

2) exemption from land tax for up to 10 years;

3) exemption from property tax for up to 8 years from the date when fixed assets (e.g., a plant) are commissioned (only for those assets which were commissioned for the first time);

4) reimbursement of up to 30 percent of actual expenses on construction works and purchase of equipment (so-called “investment subsidy” (*4)) on the basis of documentary evidence after full commissioning. To apply for an investment subsidy, an applicant must also provide a feasibility study approved by the state expertise. The Government will approve the rules on granting investment subsidies;

5) exemption from the need to obtain work permits for foreign workers of the legal entity holding the investment contract, its contractors and subcontractors in the area of research and design activities, engineering services and construction works. Such exemption is valid until the expiration of 1 year from the date of commissioning. The list of professions and number of attracted staff is set out in the investment contract;

6) stability with regard to the above tax preferences and “work permits-free” regime;

7) interaction with the Investments Committee under the principle of “one window”. An investor shall only file an application to the Investments Committee with related documents and negotiate further with the Committee regarding conditions of the investment contract;

8) simplified procedure for obtaining land plots for a Project;

9) assistance from the Investments Committee with regard to obtaining a guaranteed order(s) from national state-owned companies;

10) (this preference existed earlier and remains valid) exemption from customs fees for the import of technological equipment and spare parts, for the period of an investment contract, but not more than 5 years.