Uzbekistan Offers Tax Incentives to Support Young People

Tashkent, Uzbekistan (UzDaily.uz) — Uzbekistan provides a range of tax incentives to support young people entering the workforce, learning a profession or starting their own businesses.

Under the measures, certain categories of businesses can pay social tax on employees under the age of 30 at a rate of 1%, instead of the standard 12%.

The incentive applies to businesses engaged in retail trade, catering, hotel services, passenger and freight transportation, vehicle, computer and household appliance repairs, as well as activities in agriculture, veterinary services and entertainment.

To qualify for the 1% rate, a young employee’s monthly salary must be at least 2.5 times the minimum wage, while revenue from eligible activities must account for at least 60% of the company’s total income. The incentive is available until 1 January 2028.

Another measure applies to students under the age of 30 enrolled in schools, colleges and technical schools. From 1 September 2024 to 1 September 2027, personal income tax and social tax on employment income earned at enterprises while students acquire professional skills are set at 1%.

Young entrepreneurs under 30 who establish mobile trading businesses along roads of national importance are also exempt from taxes on income earned from selling goods and services during their first six months of operation. This incentive is likewise available until 1 January 2028.

Income earned by students at vocational and higher education institutions from paid training courses, sports clubs and other educational services provided on the institutions’ premises is excluded from aggregate income.

Reducing the Tax Burden and Supporting Employment

During a statement, a representative of the tax authorities said the incentives are intended to encourage businesses to create jobs for young people. Cutting the social tax rate from 12% to 1% reduces employers’ tax burden and makes hiring young workers more financially attractive.

Particular attention is also being paid to opportunities for students to combine their studies with practical vocational training at enterprises.

Students can gain practical experience and earn income, while employers can recruit young specialists under preferential tax conditions.

The measures are aimed at supporting youth entrepreneurship, expanding employment opportunities and helping young people acquire professional skills while studying.