International Advisory Council proposes fiscal reforms for Uzbekistan, including pension digitization

On May 13, ASR Director Bahodir Rakhmatov met with council members Alfred Gusenbauer, Aleksander Kwaśniewski, and Štefan Füle. The parties discussed initiatives prepared under the joint program slated for implementation in 2025.

The council outlined five key areas for addressing fiscal challenges, including broadening the tax base, improving the efficiency of tax administration, and ensuring greater transparency.

As part of its recommendations, the council proposed revising the formula for calculating excise duties on sugar-sweetened beverages. Instead of basing it on product volume, they suggest linking it to the amount of sugar in the drink.

Pension system reform was another major topic of discussion. To strengthen its financial sustainability, the IAC recommended adopting a legislative package consisting of five laws aimed at reforming six key areas. These include:

• The creation of private pension funds operating on the basis of voluntary contributions;
• Full digitalization of the pension appointment process and service delivery to retirees;
• The introduction of a contributory period system — a timeframe during which individuals are officially employed and make pension contributions.

The IAC also expressed its willingness to help familiarize Uzbek officials with regional development approaches used in Austria, Poland, and the Czech Republic, and to explore how they might be adapted for Uzbekistan.

In October 2024, the Cabinet of Ministers approved the composition of a working group tasked with developing a draft concept for pension reform by March. The group is led by Minister of Economy and Finance Jamshid Kuchkarov and includes ASR head Bahodir Rakhmatov.