By B.NANDID

Prime Minister N.Uchral on Thursday submitted a package of tax reform bills to Parliament Speaker S. Byambatsogt aimed at supporting businesses and stimulating the economy amid growing global economic uncertainty.

The legislative package includes amendments to the General Taxation Law as well as proposed changes to the laws on personal income tax, corporate income tax and value-added tax.

According to the Prime Minister, the reforms are intended to ease pressure on private sector businesses and improve the tax environment for citizens and entrepreneurs. One of the key proposed changes would abolish the practice of temporarily freezing the bank accounts of taxpayers with outstanding tax liabilities. Instead, taxpayers would be allowed to retain 20 percent of incoming transaction funds in their accounts. The draft law would also cap penalty charges so they cannot exceed 50 percent of the original tax amount.

The proposed amendments to the Personal Income Tax Law include introducing a simplified one percent tax rate for individuals whose annual sales revenue is below MNT 1 billion. Citizens earning less than the minimum wage would receive a full tax exemption, while people selling their first privately owned apartment or house would be exempt from property sales tax.

The government is also proposing changes to the Corporate Income Tax Law by expanding the threshold for businesses eligible for the 15 percent tax rate. Under current legislation, companies with annual revenue between MNT 0-6 billion pay a 15 percent tax. The new proposal would raise that threshold to MNT 10 billion, allowing companies with revenue between MNT 6-10 billion to remain in the same tax bracket. Officials estimate the measure would reduce the tax burden on more than 180,000 businesses.

In addition, the government plans to increase support for small and medium-sized enterprises by raising the eligibility threshold for the one percent tax regime from MNT 1.5 billion in annual sales revenue to MNT 2.5 billion.

The draft amendments to the VAT Law would also allow taxpayers to postpone VAT payments for up to two months.

Government officials said the proposed reforms are intended to create a more flexible and business-friendly tax environment while helping prevent taxpayers from falling into financial distress. Authorities also said the package would strengthen tax transparency, support the implementation of Mongolia’s international agreements and help reduce tax evasion and illicit financial flows.

Source: Zuuniimedee № 88 (7830) May 8, 2026

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