The Senate held Parliamentary hearings on “Economic Development in the New Realities: Improvement of the State Policy and Legal Regulation in the Development and Support of Small and Medium Businesses in Kazakhstan”.
Senate Speaker Maulen Ashimbayev focused his speech on topical issues of national business. He said that the number of active small and medium business entities has been increasing over the past years. However, despite this, trading remains the main area of activity for Kazakhstani small businesses, where many business entities work in the shadow economy. The amount of medium business entities is decreasing. Since 2015, the number of such enterprises has reduced by more than 13%.
The Senate Speaker also told about other problems such as the reduction of bank lending to SMBs, low level of awareness raising activities on government support measures and lack of accessibility of national companies’ procurements for entrepreneurs.
At the same time, Maulen Ashimbayev mentioned that additional measures to support business were implemented during the pandemic in Kazakhstan.
“In his Address, the Head of State suggested a range of systemic measures to support business. The possibilities for obtaining concessional loans have been expanded. State subsidizing of interest rates up to 6% has been provided. Accrual of rent charges for real estate owned by government institutions and the quasi-public sector has been suspended. The burden on the payroll fund has been reduced. A number of amendments have been introduced to the Tax Code. It is proposed to exempt small and medium businesses from paying VAT and social tax for two years. As instructed by the President, 3% retail tax has been introduced. These and other steps will definitely contribute to the SMB development,” the Chairman of the House noted.
In preparations for the hearings, senators drafted a number of recommendations for the Government to help tackle SMB issues.
In particularly, it is proposed to strengthen legislative responsibility for unlawful interference in business activities and for raiding.
“Senators support the measures to strengthen the responsibility of officials for interfering in the activities of entrepreneurs. As the President noted, the unlawful hindering of entrepreneurial activity should be qualified as the gravest crime against the state. This policy of the Head of State could be implemented through a set of amendments to the legislation. It is expected that amendments will be made to the Administrative Offences Code and the Criminal Code,” Maulen Ashimbayev said.
It was also suggested that conditions of entrepreneurs’ access to land plots should be improved. According to the Chairman of the Senate, one of the suggested measures aims at ensuring the maximum openness and accessibility of information about free land plots and scheduled bids through systematization and placement of this information on the Internet resources and other sites. The procedure for changing the target designation of land in populated areas is also proposed to be optimized, inter alia, by excluding unnecessary reconciliation procedures,” he added.
Maulen Ashimbayev announced an initiative to include microentrepreneurs into a separate category.
“It is offered to enshrine this norm in the Entrepreneurship Code. This should promote efficient and targeted support to microbusinesses as part of relevant programs, including through concessional and simplified lending,”
Maulen Ashimbayev said.
The Senate Speaker also noted the importance of effective organization of the work of the unified service “Government for Business” and the state aid information portal.
“As a whole, it is essential to develop information services that are convenient and user-friendly for people. Such products should enable businesses to better orientate themselves in the state aid tools, help to find suppliers, partners and promote products at foreign markets,” he said.
In conclusion, Maulen Ashimbayev stressed the expediency of conducting a detailed revision and systematization of the SMB legislation.
“In pursuance of the President’s assignment, the Government should conduct a comprehensive revision and systematization of the SMB-related legislation. The tax administration should be further improved. It is reasonable to consider possibilities for optimizing the entrepreneurs’ reporting. We should exclude excessive bureaucracy, duplication, contradictions, and avoid distracting business from its core activities,” the Senate Speaker said.
The event brought together parliamentarians, senior officials of central government and local executive authorities, representatives of the national chamber of entrepreneurs “Atameken”, businesses and international organizations, the Commissioner for Protection of Entrepreneurs’ Rights of Kazakhstan and members of the Senate Club of Young Experts.
Dauren Adilbekov, Chairman of the Senate Committee on Economic Policy, Innovative Development and Entrepreneurship, moderated the event.
The drafted recommendations based on the results of the Parliamentary hearings will be forwarded to the Government.
