ASTANA, Kazakhstan, December 6. Kazakhstan’s Ministry of Finance has provided clarification on the application of Value Added Tax (VAT) in government procurement processes, ahead of the implementation of the new Tax Code set to take effect on January 1, 2026, Trend reports via the ministry.
According to the provisions of the Law on Government Procurement, effective from July 1, 2024, annual government procurement plans are based on approved budgets and individual financing plans. As per the Rules for Government Procurement, these annual plans are calculated excluding VAT, including the preliminary annual plan and advance payments.
The Ministry notes that VAT and excise tax obligations are not reflected in the procurement plans, but instead are outlined directly in the contract following the procurement procedure. This aligns with the requirements of Kazakhstan’s tax and customs legislation.
Under the Tax Code, VAT are levied on the turnover from the sale of goods, works, and services, with the date of transaction being the date of delivery of goods or signing of the act of completed works or services. Starting January 1, 2026, the VAT rate will be set at 16% and will apply to all taxable turnover, including contracts signed before the new code takes effect.
Suppliers who are VAT payers will be required to issue invoices in accordance with the Tax Code’s requirements. If a supplier’s VAT status changes, the Law allows for amendments to be made to the government procurement contract to adjust the contract amount by the corresponding VAT amount, while maintaining the quality and delivery conditions as originally agreed.
The government procurement portal will automatically account for the supplier’s VAT status and will calculate the VAT for the contract, as well as split the cost between taxable and non-taxable positions.
Thus, from January 1, 2026, the 16% VAT rate will apply to all government procurement contracts, regardless of the contract’s signing date, provided the supplier is a VAT payer at the time the transaction occurs.
