The proposal was presented on July 30 during the Fiscal Dialogue event by Fazliddin Shamsiev, chief specialist at the Institute for Fiscal Analysis, Tax and Customs Administration Improvement, and Reduction of the Shadow Economy, Kun.uz correspondent reported.
According to the institute, interest earned on bank deposits has been exempt from taxation since 1998, making it one of the few forms of passive income that remains tax-free. By comparison, dividend income is taxed at 5%, while rental income, royalties and capital gains are generally subject to a 12% tax rate.
The institute proposes abolishing the existing exemption and taxing deposit interest at the same 5% rate applied to dividends. Implementing the measure would require amendments to Article 381 of the Tax Code.
To support the proposal, the authors cited international practice. Interest income is taxed at a rate of 10% in Kazakhstan, Azerbaijan and India, 15% in Thailand, 20% in Indonesia, 26.4% in Germany and between 15% and 40% in Turkey.
According to the institute's estimates, introducing the 5% tax could generate nearly UZS 1.4 trillion in additional state budget revenue.
The calculation is based on household bank deposits totaling UZS 170.2 trillion as of May 1, 2026, an average annual interest rate of 16% and the proposed 5% tax rate.
By way of example, a one-year deposit of UZS 200 million with an annual interest rate of 20% would generate UZS 40 million in interest income. Under the proposal, 5% of that amount, or UZS 2 million, would be withheld as tax.
