207 Thousand Individual Entrepreneurs Closed Down in Four Months

The introduction of the new Tax Code has triggered an unprecedented wave of closures among individual entrepreneurs (IPs). During the first quarter of 2026, 207,912 IPs ceased their activities. This represents a more than twofold increase compared to the previous year.

According to Minister of National Economy Zhumangarin, the baseline level of IP closures in the first quarters of 2024–2025 averaged around 104,000—a background figure unrelated to the reform. Thus, he estimates the direct impact of the new Tax Code at approximately 100,000 additional closures.

Notably, these figures turned out to be lower than government forecasts: authorities initially expected up to 300,000 entities to exit the market—primarily those who used business fragmentation under special tax regimes for tax optimization.

The statistics on business suspensions became a separate point of discussion. Several experts and deputies cited data from the Bureau of National Statistics suggesting that 184,906 enterprises had suspended work, interpreting this as a hidden crisis. Zhumangarin called this interpretation incorrect, stating that the figure refers to the accumulated database of all long-inactive companies. The real figure for the first quarter of 2026 is 62,557 suspensions, which is twice as high as the same periods in 2024–2025 but a fundamentally different magnitude than the 185,000 cited in public debates.

Despite the closures, the market is not stagnant. During the same first quarter of 2026, over 99,000 new taxpayers were registered—88.7 thousand IPs and 10.3 thousand legal entities. The total number of legal entities in the country has risen to 584,093. Simultaneously, the number of self-employed individuals has exceeded 410,000, with 85% choosing platform employment—working through InDrive, Yandex, Wolt, and similar services. Zhumangarin emphasized that this is not a new tax optimization scheme by big business, but rather the genuine legalization of labor through digital platforms.

The new Tax Code dealt several blows to businesses simultaneously. The VAT rate increased from 12% to 16% - a jump of four percentage points. The threshold for mandatory VAT registration was halved: from 20,000 to 10,000 MCI, or approximately from 86.5 to 43.25 million tenge in annual turnover. Another crucial innovation was introduced: large and medium-sized companies are now prohibited from claiming tax deductions for expenses on transactions with IPs using the simplified tax system who are not registered for VAT.