The Material Reserves Fund will stop purchasing oil with zero VAT

The Kyrgyz government is preparing changes to the procurement policy of the State Material Reserves Fund. Under the new rules, purchases of vegetable oil without VAT will be discontinued.

Currently, the Fund purchases oil at a zero VAT rate, which leads to purchases at prices above market rates. This causes dissatisfaction among domestic producers and reduces the transparency of procedures.

The authorities plan to introduce mandatory VAT on oil purchases, which will improve the efficiency of budget spending and ensure a level playing field for all market participants.

A zero VAT rate on socially significant goods was introduced earlier with the aim of reducing their cost to the population. However, with changes in the market situation and budget priorities, the government considers it necessary to review this approach.