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Starting a business in any foreign country will be challenging, due to different laws and customs. As with any business, the key is to have a solid business plan that is suitable to your area of specialty. Here are some pros and cons of starting a business in Kazakhstan.
- Pro – Lower Income and Corporate Tax
According to a 2011 report produced by the Heritage Foundation and The Wall Street Journal, Kazakhstan’s flat income tax rate is 10 percent and corporate tax rate is 20 percent. These tax rates are lower than the average income and corporate tax in nearby European Union states. In a 2010 article from Bloomberg Businessweek, the average income tax in the EU was 37.5 percent and the average corporate tax was 23.2 percent.
- Con – Long and Costly Process
Entrepreneurs who wish to open a business in Kazakhstan will find the process more time-consuming and costly compared to the U.S. In the U.S., a person can start a business in one day. In Kazakhstan, however, it takes a minimum of 20 days to finalize a new business and many fees are involved. A complicated bureaucratic system in Kazakhstan democracy is the main reason for this long process.
- Pro – Access to Asian and European Markets
Kazakhstan can be considered the link between Asia and Europe, since its borders reside on both continents. This provides the opportunity for business owners to have more reach into economically expanding countries, like China and Russia.
- Con – Corruption
The 2010 Transparency International Corruption Perception Index ranked Kazakhstan the 105th most corrupt country out of 178 countries. This is obviously not a good sign for business owners, so carefully weighing the positives and negatives of doing business in Kazakhstan should be addressed.
