19 Март 2020

Business Ombudsman Institute's recommendations to the Government of the Kyrgyz Republic to ease the burden of business during COVID-19 pandemic

In connection with the situation with the spread of the COVID-19 virus, the Business Ombudsman Institute expresses its concern and support to business entities and business representatives. This is an unprecedented global situation that has far-reaching consequences for trade, investment, entrepreneurs and business entities.  The pandemic is affecting business, regardless of ownership or business in a way not seen in modern times. All businesses, whether SMEs or large multinationals will struggle as governments take necessary stringent measures to protect people.   Maintaining business confidence and preventing panic in the Republic will be paramount. In this regard, the Business Ombudsman Institute submits to the Government of the Kyrgyz Republic the following proposals and recommendations for helping to alleviate the economic consequences of the pandemic in which business entities find themselves: - introduce tax holidays and 90-days tax-exempt for business entities whose activities are suspended in connection with COVID-19 per Government Decree No. 163 of March 17, 2020 (HoReCa, shopping malls, entertainment centers, sports and recreation centers, and other business specified in the Decree); - provide a 90-day grace period for disbursements of loans issued to small and medium-sized businesses without applying penalties for non-performance of obligations under credit agreements, as well as provide for the simultaneous application of a compensation mechanism for the commercial financial and credit sector in the form of tax incentives and exemptions; - provide an exemption from penalties for business entities operating in the framework of public procurement for non-performance or improper performance of obligations under public procurement contracts that arose due to current difficult circumstances; - extend the temporary ban (moratorium) on inspections of business entities by state authorities until January 1, 2022, except those related to the health and safety of citizens;  - grant visa extension and exempt from penalties foreign businessmen whose visa and registration period will end during the pandemic and closed borders; - provide a delay for submitting an Annual Tax Report for individuals engaged in business activities until July 1, 2020; - improve and speed up the procedure for acceptance of electronic messages (emails) of business entities to state and local authorities; - accelerate the process of digitalization and give an impetus to the development of technologies in the work of state bodies directly working with the business entities - the State tax service of the Kyrgyz Republic, the Social Fund of the Kyrgyz Republic; - Create a Stabilization Fund in case of future similar situations. Besides, the Business Ombudsman Institute expresses concerns about the unilateral and repressive measures taken against entrepreneurs by some state bodies and calls for a constructive dialogue between business and state bodies that oversee the economic activities of business entities. The BOI is ready to play a constructive role in this regard.  These are measures that the government can take to help businesses survive at this critical time. Additionally, we advocate that the government urge the B2B sector to show understanding and compassion with e.g. rent or debt holidays. This will help businesses to survive during these extraordinary times.
 The BOI stands ready to support the government and business community as we all seek to help the country overcome this challenge