FMCG Tax Digest (May 2026)

In May 2026, Uzbekistan adopted a number of laws and regulations, which provide for changes that may have an impact on the companies operating in the FMCG sector (including the producers and distributors of food products, beverages, and non-food products).

This digest summarises those changes that we believe to be of the most critical practical significance. For deeper understanding, we recommend to read the full texts of the laws and regulations.

It should be noted that there are also other significant developments, including changes in e-commerce taxation and approaches to the determination of market prices and tax bases, during the period under review. These issues are out of the scope of this publication and are dealt with in detail in separate analytical materials available on the EY web-site: Tax & Law Alerts | EY - Global.

Support to small business

Decree of the President of the Republic of Uzbekistan (the “RUz”) No. UP-100 dated 26 May 2026 On Creating More Favourable Economic and Administrative Conditions for the Growth of Small Business Entities provides for the following measures:

• As from 1 June 2026, the threshold for the transition to the general tax regime (VAT and CIT) is increased from UZS 1 billion to ~ UZS 5 billion¹. The threshold is calculated by reference to the basic estimated value (the “BEV”), which implies its automatic indexation in line with the changes in the BEV.
• Business entities providing hotel and catering services are allowed, among other things, to accept payments in cash when selling alcoholic and tobacco products.
• An alternative simplified VAT calculation and payment procedure has been introduced:
  • The simplified procedure covers business entities that have operations in public catering, trade or service provision as their main business activity. Exclusion is made for entities where the state owns at least 50% of share capital and large taxpayers. Transition to the simplified procedure is voluntary.
  • The simplified procedure is effective from 1 June 2026 to 1 January 2030.
  • The VAT rate is 6%.
  • The CIT rate is set at 0%.
  • The obligation to file tax reports for CIT is abolished.
  • Offset of input VAT paid on purchased goods (services) is not allowed.
  • Exemptions, preferences and refund of a portion of VAT paid that are provided under the general taxation procedure are not applicable. The resulting negative VAT difference is written-off. However, the right to offset input VAT amount is provided to the customers buying goods or services from the business entities that have transferred to the simplified procedure.
• A consequent automation of the negative VAT difference refund is provided for low-risk taxpayers, up to the point of full elimination of the human factor starting from 2027.
• The practice of suspending the VAT payer certificate is abolished, and limitations are introduced for conducting tax audits: tax audit is not applied when the risk amount is not higher than UZS 500 million and field audits are not held when the risk amount is not higher than UZS 100 million.

Tax administration reform

Presidential Decree No. UP‑95 dated 19 May 2026 On Measures to Institutionally Improve the Activities of The Tax Authorities and Introduce Modern Approaches in Tax Administration sets out the tax administration modernisation strategy for the period until 2030. The Decree determined that bringing the percentage of voluntary tax payment to 98%, decreasing high risks by 50% and enhancing the taxpayers’ trust are among its key objectives.

In particular, from 1 July 2026, the following changes are implemented:

• The taxpayer’s obligation to file updated tax reports and clarifications for differences identified in the course of the pre-audit review has been abolished;
• A new system is being implemented for sending notifications of the identified taxpayer’s risks classified as mid-level tax risks, and if the identified discrepancies are eliminated within a month, the tax audit is not performed;
• Criteria for including the taxpayers in the large taxpayer category are being implemented.

Starting from 1 August 2026, Customer Centricity Index is implemented for the tax authorities. At the same time, an option appears for the taxpayers to assess:

• Accessibility and convenience of using the tax services, and the quality of services provided by the tax authorities;
• Time spent to fulfil tax obligations and the level of interaction between the tax authorities and the taxpayers.

Acceleration and automation of tax procedures are a significant element of the reform. In particular, starting from 1 January 2027, taxpayers with a low tax risk level receive refund of the negative VAT difference, resulting from the application of a 0% tax rate and due to the acquisition of immovable property, within 3 days as part of an automated procedure, with the existing procedure for VAT recovery retained for some categories of taxpayers. In addition, the list of tax reports that are prepared pro-actively is extended. The tax reporting for agricultural land use tax is abolished.

Loan (financial support) and warehousing storage agreements are subject to registration with the tax authorities.

Implementation of the system for automated control and transfer pricing analysis

Tax administration digitalisation includes implementation of the automated system for transfer pricing control aimed at providing comprehensive analysis of controlled transactions.

The system allows identifying controlled transactions, related parties, delivering a preliminary assessment of controlled transactions for their comparability with the market level of prices and determining potential tax risks.

At the current stage, the system is undergoing pilot testing, while its functionality is gradually extended and improved.

Fines for non-compliance with obligatory digital labelling requirements

Article 227 of the Tax Code of RUz² provides for responsibility for the non-compliance with the labelling requirements. In the current edition, fines are set at 2% of net revenue for the most recent reporting period in case of an initial non-compliance and are up to 20% for a repeated non-compliance.

Changes in approaches to imposing responsibility for non-compliance with the labelling requirements were initiated as part of enhancement of the digital labelling regulation. In particular, on 18 May 2026, the Senate of the Oliy Majlis of the RUz approved the law on making changes and amendments to the TC of the RUz, which provides for the introduction of the progressive scale of fines (from 0.2% to 2% of net revenue) depending on the actual number of failures to comply. In addition, the law provides for the procedure for a remote tax audit of compliance with the labelling requirements.

Furthermore, Resolution No. 258 of the Cabinet of Ministers of the RUz dated 19 May 2026 introduced amendments to Resolution No. 631 of the Cabinet of Ministers dated 1 November 2022, whereby the deadlines for implementing the aggregation stage in the digital labelling system were extended from 1 April 2026 to 1 April 2027.  The extension was aimed at creating technical potential for a phased implementation of the mechanisms for obligatory digital labelling of sparkling and still water and beverages.

Systematisation of tax exemptions and preferences

By its Resolution No. 211 dated 29 April 2026 On Approval of the Regulation on the Procedure for the Formation and Updating of the Unified Register of Exemptions and Preferences for Business Entities on the Unified Interactive Public Services Portal of the RUz, the Cabinet of Ministers of the RUz approved the Regulation on the Procedure for the Formation and Updating of the Unified Register of Exemptions and Preferences for Business Entities.

The Unified Register is formed and maintained by governmental authorities responsible for the provision of exemptions and preferences based on the subsidiya.mf.uz information system. The Unified Register is integrated with the Unified Interactive Public Services Portal (UIPSP). The Ministry of Finance of the RUz is designated as the Unified Register’s Operator. The Unified Register contains information on existing exemptions, including their type (tax, customs, etc.), legal and regulatory grounds for their provision, effective term, conditions for application and categories of eligible entities. In addition, the Register includes information about controlling authorities and penalties for the misuse of exemptions, while inclusion of information constituting state secrecy or other legally protected secrecy is prohibited.

Property tax and land tax exemptions: procedure for calculating target indicators

Stricter conditions for property and land tax exemptions form a separate part of the tax policy reform.. Thus, the TC of the RUz has already set out that property tax and land tax exemptions for legal entities are applied when, in the current tax year, the taxpayers satisfy both of the following conditions based on the prior calendar year results:

• The aggregate income from the sale of goods (services) exceeds the amount of the used exemption for property tax for legal entities and/or land tax for legal entities;
• Monthly wage accrual to every employee in the amount of at least two minimum basic wages and average annual number of employees of at least three persons.

For developing these provisions, a draft resolution of the Cabinet of Ministers of the RUz was put forward for public discussion in the System for Assessment of the Effect of Regulations (portal: regulation.gov.uz). The draft resolution provides for a transfer to a more formalised approach to the application of property tax and land tax exemptions for legal entities. This draft document suggests that a new mechanism is introduced to assess the eligibility for applying exemptions based on a system of quantitative measures calculated using the tax reporting information, primarily for VAT (or sales tax) and personal income tax. The draft document sets out relevant conditions and formulas to calculate the above indicators and the procedure for their monitoring by the tax authorities.

The measure showing the excess of revenue over the amount of tax exemptions is a key element of the mechanism. It is calculated using the following formula:

K1 = P1 – (Им + Ие)

where P1 is the income from the sale of goods (services),

Им is the amount of property tax exemption,

Ие is the amount of land tax exemption.

This measure should have a positive value, which reflects the basic principle: the company’s economic activity should exceed the tax support that it receives.

Along with this project, additional quantitative measures are introduced, which are aimed at assessing the level of remuneration and employment.

In particular, compliance with the condition relating to the level of remuneration is assessed using the aggregate measure:

K2 = Xk1 + Xk2 + … + X12

where Xk1, Xk2, ...is the measure that reflects compliance with the condition for remuneration for each employee in the relevant period (based on the requirement of accruing at least 2 minimum basic salaries wages according to personal income tax reporting).
This measure is used to verify that the criterion for remuneration is complied with throughout the year.

At the same time, the measure of average annual employment is reviewed, which is calculated as follows:

K3 = (Xm1 + Xm2 + ... + Xm12) / 12

where Xm1, Xm2, ... is the actual number of employees for the relevant month, according to the tax reporting, and the resulting value reflects the average annual number of employees,

which allows assessing the employment stability throughout the reporting period rather than only compliance with the formal threshold for the number of employees.

How can EY help?

We would be happy to assist you in such areas as:

• Advising on the applicability of new legal requirements to your company;
• Assessing the impact of these developments on the existing business structures, including taxation of existing and planned transactions;
• Revising and updating the company’s tax accounting policies to reflect these developments;
• Drafting queries to the respective regulatory authorities on the issues of application of these legal standards that may require clarification.

We hope that you will find this information useful. We will be glad to advise you on these developments in more detail and discuss them with you if there are any questions.