On March 6, 2025, the Committee of State Revenues (CSR) of the Ministry of Finance of Kazakhstan held a press conference on the results of the “Digital VAT” pilot project, as reported by FChain Kazakhstan.
What is Digital VAT and Why is it Needed?
According to Asel Syzdykova, the lead expert in tax audit management at the CSR Audit Department, Digital VAT is a new national currency that complements cash and cashless payments. It enhances financial flow monitoring and allows VAT refunds without tax audits, improving efficiency.
The Digital VAT pilot project aims to simplify the VAT refund process for exporters applying a zero tax rate. Participants benefit from an accelerated refund system without undergoing tax inspections.
Key Benefits of Digital VAT for Businesses
Asel Syzdykova highlighted several advantages of Digital VAT for both businesses and the state:
- Reduction of VAT refund processing time from 75 to 15 business days;
- No tax audits required;
- Faster and guaranteed cash flow turnover;
- Improved financial planning.
Who Can Participate in the Pilot Project?
Eligible participants include exporters applying a zero VAT rate, specifically:
- Those exporting goods (excluding manufacturers of exported goods);
- Suppliers of fuel and lubricants to foreign airlines conducting international flights and air transportation.
How Does Digital VAT Work?
Participants purchase digital tenge from the National Bank through second-tier banks. Marked VAT can only be used for transactions with business partners and VAT payments to the state budget—it cannot be withdrawn as cash.
The National Bank and state revenue authorities monitor digital tenge transactions, ensuring VAT refunds without audits.
Enhancing Tax Transparency and Reducing Risks
Marked digital tenge can only be used for:
- Transactions with counterparties;
- VAT payments to the state budget.
This strict allocation helps prevent fraud, document falsification, and hidden financial operations, ensuring greater transparency in tax revenues.
Pilot Project Results
Launched in Q4 2024, the pilot project has already facilitated VAT refunds within five business days of request submission, without audits or risk management system interventions.
Currently, six businesses are participating, with two already receiving refunds. The CSR plans to expand digital solutions to further support businesses and enhance tax transparency.
To participate, taxpayers must open digital accounts at second-tier banks, sign a data transfer agreement, and register with the state revenue authorities.
Asel Syzdykova emphasized that the “Digital VAT” pilot project is proving effective and could mark a significant step toward a more transparent and fair taxation system in Kazakhstan.
Article is prepared by Ekaterina Kassumova,
Director of FChain Kazakhstan
12th of March 2025
