In recent years, Uzbekistan’s investment policy has focused on creating a predictable and competitive tax environment. The Tax Code, presidential decrees, and government resolutions establish a broad range of incentives for investors, including exemptions from certain taxes, preferential treatment within special economic zones, and special regimes for large-scale projects.
At the same time, the government has announced amendments to tax legislation that will take effect on 1 January 2026. These changes will affect both legal entities and foreign individual investors. This article is based exclusively on confirmed and officially published information, with explanations of the key conditions and validity periods of the available tax incentives.
Overview of tax incentives for investors in Uzbekistan:
- Core tax incentives for investors under the Tax Code: enterprises with direct foreign investment may qualify for exemptions from property tax, land tax, and water-use tax. The duration of these incentives depends on the investment amount and ranges from 3 to 7 years. https://gov.uz
- Special Economic Zones (SEZs) provide tax breaks of up to 10 years on corporate income taxes, property tax, land tax, and water-use tax, subject to meeting minimum investment thresholds. https://tax-legal.uz
- New special tax regime for foreign individuals from January 1, 2026: foreign nationals who become tax residents of Uzbekistan under the new rules will be exempt from personal income tax on foreign-source income, provided certain conditions are met (including a USD 50,000 payment, an account with a Uzbek bank/crypto wallet, minimum residence of 30 days per year, and real estate). https://kun.uz
- Tax changes for businesses from 2026 aimed at encouraging a transition to the standard tax regime: one of the key incentives includes a one-year corporate income tax exemption, as well as accounting and reporting preferences. https://kpmg.com
- New “tax zone” in Karakalpakstan for major AI projects: investments of USD 100 million or more qualify for a full exemption from taxes and customs duties until 2040, under a special regime. https://uza.uz
Detailed overview of upcoming changes.
1) Tax Incentives under the Tax Code
According to the official provisions of the Tax Code of Uzbekistan, the government grants tax incentives to companies with direct foreign investment, subject to certain conditions.
Tax incentives include:
Exemption from property tax, land tax, and water-use tax:
- 3 years — investments from USD 300,000 to USD 3,000,000
- 5 years — investments from USD 3,000,000 to USD 10,000,000
- 7 years — investments over USD 10,000,000
Key conditions: foreign ownership of at least 33%; project location outside Tashkent (with limited sector-specific exceptions); investment made in hard currency or equipment; reinvestment of a portion of the resulting tax savings. https://gov.uz
These incentives apply only if the project falls within sectors approved by legislation (manufacturing, services, and others). https://gov.uz
2) Special Economic Zones (SEZs)
Additional incentives are available to SEZ residents, providing investors with long-term tax advantages.
Corporate Income Tax (CIT)
- 3 years — investments from USD 3,000,000 to USD 5,000,000
- 5 years — investments from USD 5,000,000 to USD 15,000,000
- 10 years – investments over USD 15,000,000
Exemptions from property tax, land tax, and water-use tax apply for the same periods, pursuant to presidential decisions. https://tax-legal.uz
As a result, SEZ residents may operate for up to 10 years with minimal exposure to key taxes, provided the investment thresholds and project requirements are met. https://tax-legal.uz
3) New Incentives from 2026 – Regime for Foreign Individuals
From January 1, 2026, , Uzbekistan introduces a special tax regime targeting foreign investors and entrepreneurs.
Foreign nationals who become tax residents of Uzbekistan under the new rules will:
- Be exempt from Personal Income Tax (PIT) on income earned outside Uzbekistan.
- Conditions include: a one-time payment of USD 50,000; a bank account in Uzbekistan or a crypto wallet with a licensed exchange; physical presence in Uzbekistan for at least 30 days per year; ownership or lease of real estate. https://kun.uz
- This rule is aimed at attracting entrepreneurs, investors, and highly qualified specialists who wish to officially reside and run business in Uzbekistan. https://kun.uz
4) Incentives for Transition to the Standard Tax Regime
Official clarifications for 2026 introduce incentives for companies transitioning for the first time from simplified regimes (such as patent-based or turnover taxes) to the standard tax system. These measures include:
- Deferral or exemption from corporate income tax for one year
- Possibility to deduct accounting expenses for 6 months
- Simplified reporting and partial transfer of compliance obligations to tax authorities
- Increased thresholds for mandatory monthly advance CIT payments. https://kpmg.com
These incentives aim to reduce the tax burden on businesses, encourage formalization, and promote migration to the standard tax regime.
5) AI and Data Center Tax Zone in Karakalpakstan
A presidential decree issued in October 2025 establishes a dedicated support regime for major technology investments. Under this regime:
- Projects with investments of USD 100 million or more receive a full exemption from all taxes and customs duties until 2040;
- Additional benefits include fixed electricity tariffs and state-backed infrastructure support. https://uza.uz
This initiative is particularly relevant for AI, data center, and digital infrastructure projects driving the development of the region’s digital economy. https://uza.uz
What Investors Should Keep in Mind
These incentives are anchored in the Tax Code and investment agreements and are typically protected by stabilization clauses, meaning the benefits remain in force even if legislation changes (a standard mechanism under investment law).
Many incentives depend on the industry, region, and investment structure, including minimum foreign ownership thresholds.
Certain special regimes (such as those for IT Park residents or major technology projects) offer additional benefits that go beyond standard tax rules.
Given the existing incentives and the upcoming changes effective from 2026, proper investment structuring and strict compliance with Uzbek legislation are critical. Yasdar Consulting supports investment projects at all stages – from initial assessment of tax and legal conditions to securing incentives and liaising with government authorities. The firm assists investors in building a transparent and sustainable business model in Uzbekistan, based on the latest legislative framework.