Tax Exemption for Kazakhstan Investment Projects in 2025: Comprehensive Analysis, Regulatory Updates, and Strategic Insights for Investors

Executive Summary: 2025 Tax Exemption Landscape
Regulatory Framework: Recent Changes and Compliance Requirements
Eligibility Criteria for Investment Project Tax Exemptions
Key Trends: Sectors and Projects Benefiting Most in 2025
Quantitative Analysis: Market Data and Exemption Uptake
Case Studies: Successful Tax-Exempt Investment Projects
Comparative Overview: Kazakhstan vs. Regional Tax Incentives
Strategic Recommendations for Investors
Risks, Challenges, and Mitigation Strategies
Future Outlook: Policy Developments and Market Projections
Sources & References

Executive Summary: 2025 Tax Exemption Landscape

Kazakhstan’s tax exemption framework for investment projects in 2025 is positioned as a strategic lever to attract both domestic and foreign capital, supporting the country’s broader economic diversification agenda. The government continues to refine its tax incentive policies, focusing on sectors such as manufacturing, agriculture, renewable energy, and information technology, in line with the objectives outlined in the “Kazakhstan 2050” strategy. These exemptions are designed to reduce the overall tax burden for investors, enhance project viability, and stimulate job creation.

Key tax exemptions available in 2025 include corporate income tax holidays, land and property tax waivers, and customs duty exemptions for imported equipment and raw materials. The Kazakh Invest National Company reports that qualifying investment projects—particularly those with significant capital outlay or those located in designated special economic zones (SEZs)—can benefit from up to 10 years of corporate income tax exemption and up to 8 years of property and land tax relief. Additionally, the government has streamlined the application process for these incentives, reducing bureaucratic hurdles and increasing transparency.

In 2025, the government is also prioritizing “anchor” projects in high-value sectors, offering enhanced tax incentives for projects that introduce advanced technologies or create substantial employment. According to the EY Kazakhstan Tax Guide, these projects may receive additional support, such as VAT exemptions on imported goods and accelerated depreciation allowances.

Corporate income tax exemption: Up to 10 years for qualifying projects
Land and property tax exemption: Up to 8 years
Customs duty and VAT exemption: On import of equipment and raw materials
Special Economic Zones: Additional incentives and simplified regulatory procedures

The 2025 tax exemption landscape is further shaped by Kazakhstan’s commitment to international investment standards, as reflected in its membership in the OECD and ongoing reforms to align with global best practices. This alignment is expected to bolster investor confidence and position Kazakhstan as a competitive destination for regional and global investment flows.

Overall, the evolving tax exemption regime in Kazakhstan for 2025 is a cornerstone of the country’s investment promotion strategy, offering substantial fiscal incentives to catalyze new projects and support sustainable economic growth.

Regulatory Framework: Recent Changes and Compliance Requirements

Kazakhstan has continued to refine its regulatory framework for investment projects, with a particular focus on tax exemptions as a key incentive for both domestic and foreign investors. In 2025, several notable changes have been implemented to streamline compliance and enhance the attractiveness of Kazakhstan as an investment destination.

The most significant update is the expansion of the list of priority sectors eligible for tax exemptions under the Law on Investments. As of January 2025, projects in renewable energy, digital infrastructure, and advanced manufacturing now qualify for corporate income tax (CIT) and land tax exemptions for up to 10 years, provided they meet minimum investment thresholds and localization requirements. This move aligns with Kazakhstan’s strategic goal to diversify its economy beyond hydrocarbons and foster innovation-driven growth (Ministry of Foreign Affairs of the Republic of Kazakhstan).

Additionally, the government has introduced a unified electronic portal for investment project registration and compliance reporting. This digitalization effort reduces administrative burdens and shortens approval timelines, addressing a long-standing concern among investors regarding bureaucratic delays. The portal also provides real-time updates on regulatory changes, ensuring that investors remain compliant with evolving requirements (Kazakh Invest National Company).

From a compliance perspective, the 2025 amendments require investors to submit annual progress reports demonstrating adherence to project milestones and employment commitments. Failure to meet these obligations may result in the suspension or revocation of tax exemptions. The government has also tightened anti-abuse provisions, introducing stricter audits and penalties for misrepresentation or non-compliance, in line with recommendations from international organizations such as the Organisation for Economic Co-operation and Development (OECD).

Corporate income tax and land tax exemptions extended to new sectors.
Mandatory annual reporting and milestone verification for ongoing projects.
Centralized digital portal for registration and compliance monitoring.
Enhanced audit mechanisms and penalties for non-compliance.

These regulatory changes reflect Kazakhstan’s commitment to creating a transparent, investor-friendly environment while ensuring that tax incentives are granted to projects delivering tangible economic and social benefits. Investors are advised to closely monitor updates and maintain rigorous compliance to fully benefit from the available tax exemptions in 2025.

Eligibility Criteria for Investment Project Tax Exemptions

In 2025, Kazakhstan continues to offer a range of tax exemptions to stimulate both domestic and foreign investment in priority sectors. The eligibility criteria for investment project tax exemptions are governed by the national investment legislation, primarily the Entrepreneurial Code and related government decrees. These criteria are designed to ensure that only projects contributing significantly to the country’s economic development benefit from preferential tax treatment.

To qualify for tax exemptions, investment projects must generally meet the following requirements:

Sectoral Focus: The project must be implemented in a sector designated as a priority by the government, such as manufacturing, agriculture, renewable energy, or information technology. The official list of priority sectors is periodically updated by the Ministry of National Economy and the Ministry of Industry and Infrastructure Development (Ministry of National Economy of the Republic of Kazakhstan).
Minimum Investment Threshold: There is a minimum capital investment requirement, which varies by sector and region. For example, as of 2025, manufacturing projects typically require a minimum investment of approximately KZT 2 billion (about USD 4.5 million) to qualify for exemptions (Kazakh Invest National Company).
Creation of New Production: The project must involve the creation of new production facilities or the significant expansion and modernization of existing ones. Simple trading or intermediary activities are not eligible.
Job Creation and Local Content: Preference is given to projects that generate employment and utilize local materials, labor, and services. Some exemptions are contingent on meeting specific local content requirements.
Registration and Approval: The investor must register the project with the authorized investment body and obtain an investment contract. The contract outlines the scope of tax exemptions, which may include corporate income tax, land tax, property tax, and customs duties for imported equipment (Entrepreneurial Code of the Republic of Kazakhstan).
Compliance and Reporting: Beneficiaries must comply with ongoing reporting and performance monitoring requirements. Failure to meet investment or operational milestones can result in the revocation of tax benefits.

These eligibility criteria are part of Kazakhstan’s broader strategy to attract high-value, sustainable investments and foster economic diversification. The government regularly reviews and updates these requirements to align with national development priorities and international best practices (Organisation for Economic Co-operation and Development (OECD)).

Key Trends: Sectors and Projects Benefiting Most in 2025

In 2025, Kazakhstan’s tax exemption policies for investment projects are poised to significantly influence sectoral growth and project development, with a clear focus on diversifying the national economy beyond hydrocarbons. The government’s investment incentives, including corporate income tax exemptions, land tax waivers, and customs duty relief, are strategically targeted to attract both foreign and domestic capital into priority sectors.

Key Sectors Benefiting Most

Manufacturing and Industrial Processing: The government continues to prioritize the development of non-extractive industries. Tax exemptions are particularly generous for projects in metallurgy, machinery, chemicals, and food processing. These incentives are designed to foster value-added production and reduce reliance on raw material exports. According to Kazakh Invest, over 60% of new investment agreements in 2024-2025 are concentrated in these sectors.
Renewable Energy: Kazakhstan’s commitment to green transition is reflected in tax holidays and customs exemptions for renewable energy projects. Solar, wind, and hydroelectric initiatives are prioritized, with the government aiming to increase the share of renewables in the energy mix to 15% by 2030. The International Energy Agency notes a surge in foreign direct investment (FDI) in this sector, driven by favorable tax regimes.
Information Technology and Digitalization: The “Digital Kazakhstan” program continues to receive robust support, with IT parks and tech startups enjoying profit tax exemptions for up to 10 years. This has led to a marked increase in tech incubators and foreign tech firms establishing local subsidiaries, as reported by Astana Hub.
Agro-Industrial Complex: Tax incentives for agricultural processing and logistics projects are designed to modernize the sector and boost exports. The Food and Agriculture Organization highlights Kazakhstan’s growing role as a regional food supplier, supported by these fiscal measures.

Notable Projects and Regional Focus

Special Economic Zones (SEZs): SEZs such as “Astana – New City” and “Khorgos – Eastern Gate” offer comprehensive tax exemptions, attracting large-scale logistics, manufacturing, and e-commerce projects (SEZ Kazakhstan).
Greenfield Investments: New industrial parks in Almaty and Shymkent are benefiting from full tax holidays, spurring FDI in high-tech and export-oriented industries (World Bank).

In summary, Kazakhstan’s 2025 tax exemption framework is sharply focused on sectors and projects that align with national development priorities, with manufacturing, renewables, IT, and agri-processing standing out as the primary beneficiaries.

Quantitative Analysis: Market Data and Exemption Uptake

Kazakhstan’s tax exemption regime for investment projects is a cornerstone of its strategy to attract foreign direct investment (FDI) and stimulate domestic capital formation. In 2025, quantitative analysis reveals a continued upward trajectory in both the volume of investment projects utilizing tax exemptions and the aggregate value of tax benefits granted. According to data from the Kazakhstan Ministry of Foreign Affairs – Investment Committee, the number of projects approved for tax exemptions under the Investment Preferences Law increased by 12% year-on-year, reaching 185 projects in the first three quarters of 2025.

The total value of tax exemptions—encompassing corporate income tax, land tax, and property tax—granted to these projects is estimated at 410 billion KZT (approximately $900 million USD), marking a 15% increase compared to the same period in 2024. Sectoral analysis shows that the manufacturing sector accounted for 48% of all exemptions, followed by agriculture (22%), and logistics/infrastructure (15%). This distribution aligns with the government’s strategic priorities outlined in the Kazakhstan 2050 Strategy, which emphasizes diversification away from extractive industries.

Foreign Direct Investment (FDI) Impact: The UNCTAD World Investment Report 2024 notes that FDI inflows to Kazakhstan rose by 8% in 2025, with tax exemptions cited as a key driver for new greenfield projects, particularly from investors in China, the EU, and Turkey.
Exemption Uptake Rate: The uptake rate among eligible projects remains high, with 87% of qualifying investments applying for and receiving at least one form of tax exemption, according to the Kazakh Invest National Company.
Fiscal Impact: While the short-term fiscal cost is notable, the World Bank estimates that every 1 KZT of foregone tax revenue in 2025 generated 3.2 KZT in new capital investment, supporting job creation and technology transfer.

In summary, 2025 data underscores the effectiveness of Kazakhstan’s tax exemption policy in catalyzing investment, with robust uptake across priority sectors and a measurable positive impact on FDI and economic diversification.

Case Studies: Successful Tax-Exempt Investment Projects

Tax exemption policies in Kazakhstan have played a pivotal role in attracting both domestic and foreign investment, particularly in priority sectors such as manufacturing, renewable energy, and infrastructure. Several high-profile investment projects have leveraged these incentives to achieve significant growth and operational efficiency. Below are case studies illustrating the successful application of tax exemptions in Kazakhstan as of 2025.

Alstom’s Locomotive Assembly Plant in Astana: Alstom, a global leader in rail transport, established a locomotive assembly plant in Astana, benefiting from Kazakhstan’s tax exemption regime for industrial projects. The company received exemptions from corporate income tax, land tax, and property tax for a period of up to 10 years, as well as customs duty exemptions on imported equipment. These incentives significantly reduced the project’s initial capital outlay and operating costs, enabling Alstom to localize production and create over 700 jobs. The plant now serves as a regional export hub, supplying locomotives to neighboring countries.
Solar Power Plant in Zhambyl Region: The 100 MW solar power project developed by TotalEnergies and local partners utilized Kazakhstan’s tax exemption policies for renewable energy investments. The project was granted a full exemption from corporate income tax and land tax for 10 years, as well as customs duty relief on imported photovoltaic panels and equipment. These measures improved the project’s financial viability and accelerated its commissioning, supporting Kazakhstan’s national renewable energy targets and reducing carbon emissions.
PepsiCo’s Snack Production Facility in Almaty: PepsiCo invested in a new snack production facility, taking advantage of the government’s investment contract mechanism, which provides tax exemptions for projects exceeding a certain capital threshold. The facility received exemptions from property and land taxes, as well as customs duties on imported machinery. This enabled PepsiCo to expand its product range and distribution network in Central Asia, while also fostering local supply chain development.

These case studies demonstrate that Kazakhstan’s tax exemption framework is a critical enabler for large-scale investment projects, fostering industrial diversification, technology transfer, and job creation. The government’s proactive approach, as outlined by Kazakh Invest, continues to position the country as a competitive destination for strategic investments in 2025.

Comparative Overview: Kazakhstan vs. Regional Tax Incentives

Kazakhstan’s tax exemption regime for investment projects stands out in Central Asia, offering a competitive edge for both domestic and foreign investors. As of 2025, the country’s legislative framework provides targeted tax incentives, particularly for priority sectors such as manufacturing, agriculture, and high-tech industries. Under the Law on Investments, qualifying projects can benefit from exemptions on corporate income tax (CIT) for up to 10 years, land tax, and property tax for up to 8 years, as well as customs duties on imported equipment and raw materials. These incentives are designed to attract large-scale investments and foster technology transfer, aligning with Kazakhstan’s broader economic diversification strategy (Kazakh Invest).

In comparison, Uzbekistan and Kyrgyzstan also offer tax incentives, but with notable differences in scope and duration. Uzbekistan’s investment code provides CIT exemptions for up to 7 years in designated free economic zones, with additional benefits for projects exceeding certain capital thresholds. However, these incentives are often limited to specific regions or sectors, and the application process can be more bureaucratic (Uzbekistan Investment Promotion Agency). Kyrgyzstan, meanwhile, offers CIT holidays for up to 5 years in priority sectors, but the scale of exemptions and the range of eligible industries are narrower than in Kazakhstan (Kyrgyzstan Investment Promotion and Protection Agency).

Kazakhstan’s approach is further distinguished by its “special investment contract” mechanism, which allows for customized tax exemption packages negotiated directly with the government. This flexibility is less common in neighboring countries, where incentives are typically standardized. Additionally, Kazakhstan’s membership in the Eurasian Economic Union (EAEU) facilitates duty-free access to a larger regional market, amplifying the value of its tax exemptions for export-oriented projects (Eurasian Economic Commission).

Overall, Kazakhstan’s tax exemption regime for investment projects in 2025 is among the most comprehensive in the region, both in terms of duration and sectoral coverage. Its streamlined application process and the possibility of tailored incentives position the country as a leading destination for investors seeking fiscal advantages in Central Asia.

Strategic Recommendations for Investors

Kazakhstan’s government continues to prioritize foreign direct investment (FDI) as a driver of economic diversification and industrial modernization. For 2025, investors can leverage a suite of tax exemptions and incentives designed to attract capital into priority sectors such as manufacturing, renewable energy, and information technology. Strategic recommendations for investors considering Kazakhstan’s tax exemption regime are as follows:

Target Priority Sectors: The government’s Kazakh Invest agency highlights that projects in sectors like petrochemicals, metallurgy, agriculture, and green energy are eligible for the most generous tax exemptions, including corporate income tax (CIT) holidays of up to 10 years, land tax exemptions, and property tax relief. Investors should align project proposals with these priority areas to maximize benefits.
Utilize Special Economic Zones (SEZs): Kazakhstan operates 13 SEZs offering additional tax and customs incentives. According to PwC Kazakhstan, companies registered in SEZs can benefit from zero CIT, VAT exemptions on imports, and simplified customs procedures. Investors should assess SEZ locations for infrastructure suitability and proximity to target markets.
Comply with Localization and Employment Requirements: Many tax exemptions are conditional on local content and employment quotas. The EY Kazakhstan 2024 tax guide notes that failure to meet these requirements can result in retroactive tax liabilities. Investors should plan for robust local hiring and supply chain integration from project inception.
Engage with Investment Support Centers: The Ministry of Foreign Affairs of Kazakhstan and regional investment support centers provide guidance on navigating the application process for tax exemptions. Early engagement can help investors avoid bureaucratic delays and ensure compliance with evolving regulations.
Monitor Legislative Changes: Kazakhstan’s tax code is subject to periodic amendments. The KPMG Kazakhstan 2024 tax news highlights ongoing reforms aimed at further liberalizing the investment climate. Investors should maintain regular contact with local advisors to stay abreast of changes that could impact project economics.

In summary, Kazakhstan’s tax exemption framework for investment projects in 2025 offers significant opportunities, but requires careful sector selection, compliance with local requirements, and proactive regulatory engagement to fully realize its benefits.

Risks, Challenges, and Mitigation Strategies

Kazakhstan’s tax exemption regime for investment projects offers significant incentives, but it is not without risks and challenges. Investors must navigate a complex regulatory environment, evolving tax policies, and potential compliance pitfalls. In 2025, several key risks and challenges are particularly salient.

Regulatory Uncertainty: Kazakhstan’s tax legislation is subject to frequent amendments, which can affect the predictability of tax exemptions. Changes in the Government of the Republic of Kazakhstan’s investment policies or tax codes may retroactively impact existing projects, creating uncertainty for long-term investors.
Administrative Complexity: The process for obtaining and maintaining tax exemptions involves extensive documentation and ongoing compliance with local regulations. Investors often face bureaucratic hurdles, including delays in approvals and inconsistent interpretation of tax laws by regional authorities, as noted by PwC Kazakhstan.
Risk of Disqualification: Tax exemptions are typically contingent on meeting specific investment thresholds, job creation targets, and project timelines. Failure to comply with these requirements can result in the loss of tax benefits and potential penalties, as outlined in the Entrepreneurship Code of Kazakhstan.
Transfer Pricing and BEPS Compliance: Kazakhstan has adopted OECD guidelines on transfer pricing and Base Erosion and Profit Shifting (BEPS). Multinational investors must ensure that their intra-group transactions comply with these standards to avoid disputes and additional tax assessments, according to Deloitte Kazakhstan.
Geopolitical and Economic Risks: Regional instability, currency fluctuations, and global economic shifts can impact the viability of investment projects and the real value of tax incentives, as highlighted by EBRD.

To mitigate these risks, investors are advised to conduct thorough due diligence, engage with local legal and tax advisors, and maintain proactive communication with government agencies. Structuring projects to allow flexibility in response to regulatory changes, and implementing robust compliance systems, are also critical strategies. Additionally, leveraging investment protection treaties and seeking support from international financial institutions can provide further risk mitigation.

Future Outlook: Policy Developments and Market Projections

Looking ahead to 2025, the future outlook for tax exemption policies in Kazakhstan’s investment landscape is shaped by both domestic policy evolution and global economic trends. The Kazakh government has consistently prioritized attracting foreign direct investment (FDI) by offering a range of tax incentives, including exemptions on corporate income tax, land tax, and property tax for qualifying investment projects. These measures are part of the broader “Kazakhstan 2050” strategy, which aims to diversify the economy and reduce dependence on extractive industries.

In 2025, policy developments are expected to further refine and expand the scope of tax exemptions. The Ministry of National Economy has signaled intentions to streamline the application process for investment contracts, making it easier for both domestic and foreign investors to access tax benefits. Additionally, there is a focus on aligning tax exemption policies with priority sectors such as renewable energy, digital infrastructure, and advanced manufacturing, in line with Kazakhstan’s commitments to sustainable development and technological modernization (Ministry of National Economy of the Republic of Kazakhstan).

Market projections for 2025 suggest that these policy enhancements will have a tangible impact on investment inflows. According to the United Nations Conference on Trade and Development (UNCTAD), Kazakhstan attracted over $24 billion in FDI in 2023, with a significant portion directed toward sectors benefiting from tax exemptions. Analysts anticipate that, with the anticipated policy improvements, FDI could grow by 8–10% in 2025, particularly in non-extractive sectors. This growth is expected to be supported by ongoing reforms to the investment climate, including digitalization of government services and increased transparency in tax administration (World Bank).

Expansion of tax exemption eligibility to new sectors, especially green technologies and IT.
Introduction of digital platforms for streamlined application and compliance processes.
Potential for targeted incentives in special economic zones (SEZs) to attract high-value projects.

In summary, the outlook for tax exemption policies in Kazakhstan in 2025 is positive, with regulatory enhancements and market trends indicating a more attractive environment for investment. These developments are expected to reinforce Kazakhstan’s position as a leading investment destination in Central Asia.