KAZAKHSTAN Law and Practice Contributed by: Timur Odilov, Mikhail Abdulov, Olzhas Abubakirov and Alnur Dauylbay, Haller Lomax LLP
• the development of sustainable groundwater use; and • the construction and/or modernisation of treatment facilities in the 20 largest cities in Kazakhstan, requiring an estimated investment of USD1–2 bil - lion. Please also refer to 3.1 Climate Change Effects regarding the Strategy for Achieving Hydrocarbon Neutrality in the Republic of Kazakhstan by 2060. 3.4 Energy-Transition Minerals Kazakhstan produces approximately 18 of the 34 essential raw materials identified by the EU as crucial for batteries, electric vehicles, solar panels and other components in the renewable energy sector. These materials encompass bismuth, gallium, rare earth ele - ments, silicon, vanadium, tungsten, lithium, indium, cobalt, etc. Despite this significant resource, there are currently no specific legislative initiatives related to “energy- transition minerals”. In 2023, the MIC developed a Comprehensive Plan for the Development of the Rare and Rare Earth Metals Industry for 2024–2028 (the “Comprehensive Plan”). The Comprehensive Plan provides for the expansion of the resource base and the introduction of tech - nologies for the complex extraction of rare metals, the modernisation of existing production facilities, the development of standards regulating the industry and the lifting of the secrecy regime for certain metals. Additionally, as part of the implementation of the Comprehensive Plan, the Development Bank of Kazakhstan in 2025 developed a 2025–2030 financing programme for projects on energy-transition minerals, with a total budget of USD1 billion. This programme is intended to become a key financial tool for advancing projects in the mining and metallurgical sector related to the processing of rare earth and critical materials. At present, Kazakhstan’s energy-transition minerals sector remains in its early stages. Only a limited num - ber of such minerals are being mined or processed
domestically, while most companies are still focused on exploration and identifying new deposits.
4. Taxation of Mining and Exploration 4.1 Mining and Exploration Duties, Royalties and Taxes Mining companies operating in Kazakhstan are obli - gated to adhere to the standard taxes and duties applicable to all legal entities, including: • corporate income tax, currently set at a rate of 20% (25% for second-tier banks and the gambling industry); • value-added tax (VAT), currently set at a rate of 16%; as well as specific subsoil use taxes and duties. In this regard, mining companies must maintain sepa - rate tax accounting for their activity under a subsoil use licence/contract and their non-subsoil use-related activity. Both companies and joint ventures registered in Kazakhstan are regarded as residents for tax pur - poses. The specific taxes and other payments of a fiscal nature for mining companies are as follows: • Signature bonus: A one-off payment made by a subsoil user upon either acquiring a subsoil use right for a particular territory or in case of its enlargement. The signature bonus for an explora - tion licence equates to 100 MCIs (approximately USD816); for a mining licence, it is 200 MCIs (approximately USD1,632). • Mineral extraction tax (MET): A volume-based tax applicable to extracted minerals. The taxable base is the value of the whole extracted volume of min - erals. The price of minerals is determined based on the information from the London Metal Exchange. MET is paid separately at specific MET rates for each type of extracted mineral, ranging from 0% to 21.06%. For gold and silver, the MET rates range from 7.5% to 11%, depending on the mid-market price of the respective minerals. • property tax (1.5%); and • land tax (the rates vary),
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