Mining 2025

KAZAKHSTAN Law and Practice Contributed by: Timur Odilov, Mikhail Abdulov, Olzhas Abubakirov and Dauren Sadykov, Haller Lomax LLP

4. Taxation of Mining and Exploration 4.1 Mining and Exploration Duties, Royalties and Taxes Mining companies operating in Kazakhstan are obligated to adhere to the standard taxes and duties applicable to all legal entities, including: • corporate income tax is currently set at a rate of 20%. The government is considering raising it to 25% for the financial sector, and gambling industry; • value-added tax is currently set at a rate of 12%; as well as specific subsoil use taxes and duties. In this regard, the mining companies shall main - tain separate tax accounting for the activity under a subsoil use licence/contract and its non-subsoil use-related activity. Both compa - nies and joint ventures registered in Kazakhstan are regarded as residents for tax purposes. The specific taxes and other payments of a fis - cal 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 exploration licence equates to 100 MCIs (approximately USD738); for a mining licence it is 200 MCIs (approximately USD1,477). • Mineral extraction tax (MET) – a volume- based tax applicable to extracted minerals. The taxable base is the value of the whole extracted volume of minerals. The price of • property tax (1,5%); and • land tax (the rates vary),

minerals is determined based on the informa- tion from the London Metal Exchange. (a) MET is paid separately at specific MET rates for each type of extracted mineral, ranging from 0% to 21.06%. (b) Under the previous tax legislation, Kazakhstan used the system of royal- ties paid by subsoil users, however this system was abolished and replaced by the MET system on 1 January 2009. • Rental fees – paid as a licence obligation under exploration and mining licences. The amounts are as follows: for an exploration licence, between 15 and 60 MCIs (approxi - mately USD112 to USD443) for one block, depending on the year of exploration; for a mining licence, 450 MCIs (approximately USD3,333) per square kilometre of the licence area. • Payment for compensation of historical costs – a fixed payment made in instalments to compensate the state for the costs of a geo - logical survey and exploration conducted on a subsoil area that were incurred before the execution of a subsoil use contract. The tax legislation in Kazakhstan does not dis - tinguish between national and foreign investors. Note that a new tax code is under development, scheduled for adoption by late 2025 and imple - mentation starting in January 2026. 4.2 Tax Incentives for Mining Investors and Projects Generally, subsoil users carrying out operations for the exploration and/or mining of mineral resources are not allowed to enjoy tax or other preferences. Investment preferences (including tax prefer - ences) for subsoil users may be provided by conclusion of the following.

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