On September 1, 2023, the President of Kazakhstan, in his address "An Economic Course for a Fair Kazakhstan", pointed to the need to further decriminalize certain economic offences and to establish fair boundaries on the criminal liability of entrepreneurs for tax offences.

To implement this goal, Kazakhstan's lower chamber of Parliament, the Majilis, developed the Draft Law "On Amendments and Additions to Certain Legislative Acts of the Republic of Kazakhstan on Further Decriminalization of Economic Offences and Countering Legalization (Laundering) of Illegally Obtained Income and Financing of Terrorism" ("Draft Law on Decriminalization") and approved it in the second reading on May 29, 2024.

In the field of customs and tax offences, the Draft Law on Decriminalization proposes the following important changes in criminal legislation:

• To exclude from the Criminal Code responsibility for violation of the legislation on accounting and financial reporting (Article 241 of the Criminal Code), and transfer it to the Code of Administrative Offences ("Administrative Code") according to the Draft Law "On Amendments and Additions to the Code of the Republic of Kazakhstan on Administrative Offences" ("Draft Law on amendments to the Administrative Code").
• To exclude from the Criminal Code liability for the illegal receipt of a loan or non-purpose use of a budget loan (Article 219 of the Criminal Code).
• To partially decriminalize certain violations of customs legislation. It increases the threshold for criminal liability under Article 236 of the Criminal Code for avoidance of customs duties from 5 000 MCI (large size) to 10 000 MCI (extra-large size). At the same time, administrative liability for this offence is expected to be revised (Article 551 of the Administrative Code).

The Draft Law on Amendments to the Administrative Code proposes to change the type of sanction under Article 551 of the Administrative Code by replacing the fixed fine for each goods declaration (expressed in MCI) with a fine of 25% of the amount of unpaid customs payments and taxes (50% for repeat offences).

• To increase the threshold for criminal liability for economic smuggling (Article 234 of the Criminal Code) from 10 000 MCI (large size) to 20 000 MCI (extra-large size).
• To supplement the Criminal Procedure Code of the Republic of Kazakhstan with a list of circumstances which exclude the commencement of a pre-trial investigation on violations in the sphere of economic activity. According to the proposed amendments, applications on tax offences are not subject to registration

a. In the absence of an inspection act (specialist's opinion) indicating sufficient data on the presence of evidence of a criminal offence,

b. During appeal period of acts of tax authorities,

c. In cases of full voluntary payment of accrued tax amounts (with exceptions).

Since June 5, 2024, the Draft Law on Decriminalization and Draft Law on Amendments to the Administrative Code have been under consideration in the Senate (the upper house of the Parliament of the RK). In accordance with paragraph 56 of the Rules of Procedure of the Senate of the Parliament of the RK, amendments and additions to the codes are considered at least in two readings.