A presidential decree has been adopted to support large urban development projects with a high multiplier effect in New Tashkent city and other areas, offering investors tax breaks for up to 15 years under a special legal regime.

The decree extends all powers, privileges and rights granted to the directorate for building New Tashkent city to the directorates responsible for building other special areas. These include independently setting and approving requirements for area development planning documents, setting key requirements for facilities to be built on land plots when they are sold, and setting separate technical conditions for each project.

A “regulatory sandbox” special legal regime will be implemented in the designated areas for large urban development investment projects. It will offer privileges and preferences on a “state–investment partner” basis.

Under the regime, legal entities carrying out an urban development project will pay profit tax at a 1% rate on profit from leasing and selling project facilities. The period is five years for direct investment of at least $50 million, 10 years for at least $100 million and 15 years for at least $500 million.

For projects with investment of at least $50 million, legal entities will be exempt from property tax and land tax for 20 years on the facilities used.

Services that the general contractor and the lead design organization buy from foreign individuals and companies not operating in Uzbekistan will be exempt from value-added tax.

Dividend income that investors (initiators) receive from a project will be tax-free until Jan. 1, 2040, if it is reinvested in Uzbekistan.

The directorate for building New Tashkent city already holds the powers, privileges and rights that the decree now extends to other special-area directorates.