Investment Priority Project in Kazakhstan

What was an Investment Priority Project?

An Investment Priority Project (IPP) was a category of investment project under the Entrepreneurial Code of the Republic of Kazakhstan No. 375-V dated 29 October 2015. It was carried out under an investment contract with the authorised investment body, for new production or for the expansion or renewal of existing production, in priority activities approved by the Government. Law No. 215-VIII dated 18 July 2025 repealed the articles of the Code on the conditions and incentives for these contracts (Articles 286–290) from 1 January 2026, and the IPP contract is no longer among the investment contracts listed in Article 283. A new IPP contract therefore cannot be concluded.

Existing IPP contracts — what is preserved

Article 837 of Tax Code No. 214-VIII preserves existing IPP contracts until they expire. For contracts concluded between 1 January 2018 and 1 January 2026, both the tax preferences and the guarantee of tax stability are preserved. For contracts concluded before 1 January 2018 under the former investment legislation, the guarantee of tax stability is preserved. Article 283-4(6) of the Entrepreneurial Code refers to IPPs concluded before 1 January 2025, so a contract signed during 2025 should be checked against both texts. If a contract ends early, the company pays the taxes and customs duties it did not pay because of the preferences (Entrepreneurial Code, Article 295). Bond Stone reviews each legacy contract at the outset of a mandate.

Incentives under existing IPP contracts

The tax preferences in an IPP contract came from Article 712 of former Tax Code No. 120-VI: a 100% reduction of corporate income tax (CIT) on income from priority activities earned through the fixed assets commissioned under the contract; and, for new production only, a land tax coefficient of 0 and property tax at 0%. For new production the CIT reduction and land tax relief end no later than 10 consecutive years counted from 1 January of the year after the contract was concluded, and the property tax relief no later than 8 years counted from 1 January of the year after the first asset was recognised. For expansion or renewal the CIT reduction ends no later than 3 years counted from 1 January of the year after commissioning (former Tax Code, Article 712(2) to (4)). An IPP contract gave no VAT exemption; the construction VAT refund is a general rule (Tax Code, Article 129). Customs duty exemptions and state in-kind grants depend on the terms of the individual contract. Income from other activities is taxed in the ordinary way.

What applies now — the investment agreement

The investment agreement (Entrepreneurial Code, Article 283-1) is concluded between a Kazakhstani legal entity and the authorised investment body. The minimum investment is 2 million MCI for new production facilities; 5 million MCI for the expansion or renewal of existing production; 1 million MCI for new food and light industry facilities; 200,000 MCI for tourist facilities in priority tourist areas; and 1 million MCI for qualifying hotels outside the capital and the cities of republican significance. The Monthly Calculation Index (MCI) is the figure in the budget law in force on the application date. Preferences are granted only against counter-obligations. They comprise a 100% CIT reduction, a land tax coefficient of 0, property tax at 0%, stability of those rates and reductions, state in-kind grants and the right to engage foreign workers (Entrepreneurial Code, Articles 283-1 and 283-4; Tax Code, Article 736). The tax preferences run for up to 10 years depending on project value and activity: the CIT reduction for new production and the land tax relief for up to 10 years, property tax relief for up to 8 years from the year after the first asset is recognised, and for expansion or renewal the CIT reduction for up to 3 years after commissioning (Tax Code, Article 736(3) to (5)). These are the same limits as under existing IPP contracts. An investment agreement gives no VAT or customs relief. Agreements concluded before 1 January 2026 keep their tax conditions and stability guarantee until they expire (Tax Code, Article 838). The project must fall within priority activities approved by the Government. Agreements cannot be concluded for, among others, financial and insurance activities, subsoil use, the production or wholesale of excisable goods, gambling or digital mining, or with SEZ, Astana Hub or AIFC participants. Thresholds and priority activity lists change, so they should be checked against the current official text before any eligibility decision.

What applies now — other investment contracts

An investment commitment agreement (Entrepreneurial Code, Articles 283-2 and 295-2) is concluded with the Government by a large or medium-sized goods producer, other than hydrocarbon producers and oil product makers, for investment in long-term assets of at least 75 million MCI over eight years; it gives a guarantee of tax stability for 10 years from 1 January of the year it is concluded, which does not cover VAT, excise, the fee for negative environmental impact, individual income tax or CIT withheld at source (Tax Code, Article 737(2) and (3)). A simplified investment contract (Entrepreneurial Code, Articles 283-3 and 283-5) gives state in-kind grants of up to 30% of the investment in long-term assets and customs duty exemptions on technological equipment, components, spare parts, raw materials and materials, generally for up to five years. Preferences are available under one contract type only (Article 283(3-1)). Bond Stone advises on eligibility, the application, negotiation of contract terms and ongoing compliance.

Green Corridor — fast-track mechanism

Qualifying investment projects may access the Green Corridor — a procedure under the Rules for the one-stop shop for investors approved by Order of the Minister of Foreign Affairs No. 11-1-4/327 dated 26 June 2023 (restated by Order No. 11-1-4/313 dated 8 June 2026), which gives accelerated access to state services. Eligibility is set by a points system in Annex 1 to the Rules, based on investment volume, the investor's presence in the Global 2000 list, the priority of the sector and the number of jobs created. Bond Stone advises on Green Corridor eligibility assessment and application.