The Legislative Chamber of the Oliy Majlis of Uzbekistan approved a law in three readings on Tuesday to amend Article 227-1 of the Tax Code, which entrepreneurs referred to as "executioner". The article pertains to violations related to fiscal markings, automated accounting tools, integration with tax authorities' systems, and mandatory digital product labeling.
Recognizing the disproportionate penalties, contradicting the updated Constitution, deputies approved a 98% reduction in fines, from 100% to 2% of net revenue. The amended article also introduces a provision for repeat offenses within a year, imposing a 20% fine on net revenue.
Deputies highlighted that this law will further liberalize tax law enforcement, define fair tax violation penalties, prevent infractions, and reduce unnecessary costs for businesses. The law now awaits approval from the Senate and the President.
In February, over 1500 entrepreneurs were fined under Article 227-1, totaling 700 billion Uzbekistani som. Tax consultants and entrepreneurs criticized penalties imposed on trading and catering businesses for using certain internal accounting programs without integration with tax authorities' systems.
In mid-February, the Chairman of the Chamber of Commerce and Industry, Davron Vahabov, announced plans to reduce fines by 98% for offenders who fully settle their fines. It was reported that fines totaling 400 billion som are set to be waived.
At the end of February, President Shavkat Mirziyoyev signed a decree to soften financial sanctions for business violations related to fiscal markings and product labeling, instructing the development of amendment proposals within a month.
