Taxes collected from SMEs to be refunded www.gogo.mn
Amendments to 24 tax-related laws are currently under public discussion until March 23. Prime Minister Khurelsukh Ukhnaa previously assured that 90 percent of Corporate Income Tax collected from SMEs will be refunded regardless of the field of operation. SMEs who have an annual sales revenue of less than MNT1.5 billion will be entitled to receive the refund.
The draft amendments also dictate to cut 20 percent dividend distribution tax of non-residents to 5 percent.
According to MarketIntel, the biggest factors hindering Mongolia’s competitiveness were its foreign currency regulations, corruption, political instability, and inefficient government bureaucracy. Furthermore, laws in recent years have set high capital contribution requirements for foreign- owned companies and the Government of Mongolia’s 2013 attempt to renegotiate Rio Tinto’s Oyu Tolgoi mining contract set a dangerous precedent in the eyes of foreign companies and slowed FDI.
MarketIntel views that the tax bill is likely to be passed with some minor changes. The MPP government is obliged to bring an attractive plan to the table as soon as possible to garner public and business support. The government is already under public pressure due to its increasing unpopularity over recent fuel price increases, the failed attempt to raise the personal income tax rate in January 2018, and scandals surrounding the Erdenet Mine.
Published Date:2018-03-14