Monday, 18, January, 2021

The Ministry of Finance proposed to introduce an excise tax of 20% on the imported sugar as of January 1, 2021 in the amendments to the tax policies for 2021" (PDF).

"White sugar without flavoring or coloring additives" (HS Code 1701 99) could be added to the list of excisable goods is planned to include. At the same time, raw sugar imported to Uzbekistan is not subject to excise tax, the Ministry of Finance noted.

Khorezm Shakar and Angren Shakar sugar factories of Uzbekistan have virtually suspended operations since the fall of 2017 after the devaluation of the soum, which prompted sharply increase in of sugar imports (US$ 1 billion worth imports in 2016-2018). The rates of import duties and excise taxes on the import of sugar and its derivatives into the country were zeroed, while the 30 percent rate was in force in the early 2000s. In 2019, the factories resumed work.

From January 1, 2020, imported sugar began to be subject to an excise tax of 20%, but in April due to the coronavirus pandemic, the government scrapped duties and excise taxes on 20 items, including sugar.

In the summer, the Angren Shakar and Khorazm Shakar again suspended production due to lack of raw materials, due to being able to compete with imported sugar because of the zero customs duty and excise tax rate on sugar imports, while both local enterprises continue to pay excise taxes.

In addition, locally produced sugar, since January 1, hasbeen sold on the domestic market exclusively through exchange trading with ensuring equal access to exchange trading for all categories of buyers, except for volumes of no more than 10% of the total production volume to be sold under direct contracts.

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