Starting from April 1st, the zero VAT rate on heating services will be abolished in Uzbekistan, as reminded by the press service of Veolia Energy Tashkent. This change also applies to water supply, sewage, and sanitation services, as per the amendments made to the Tax Code of Uzbekistan earlier this year.
What does this mean for consumers? From April 1st, a 12% VAT will be added to the established tariff for heating and hot water services, whereas previously these services were exempt from VAT. The VAT collected goes to the state budget and is not part of the heating tariff.
Will VAT affect advance payments? Yes, but only starting from April 1st, 2024. In this case, the tariff itself will not be recalculated, as VAT is a tax separate from the tariff. Therefore, all charges for heating services will include VAT from April 1st onwards.
The calculation of VAT for the sale of thermal energy is conducted in accordance with the Tax Code of the Republic of Uzbekistan. The Tax Committee has released a video explaining the impact of the zero VAT rate cancellation on tariffs.
