IMF Resident Representative: Tax rates of Mongolia are low

Ulaanbaatar /MONTSAME/ “ - Tax rates of Mongolia are low, compared to rates in developing countries. To some extent, it is so low that almost equals to tax rates in offshore zones. A personal income tax rate of 10 percent is at the same level as that in the countries of the Middle East” said International Monetary Fund Resident Representative for Mongolia Neil Saker. He said above in his response to a question that would the Mongolian Government's action to raise rates of six types of tax and contribution of social insurance in order to meet IMF requirements for getting USD440 million of loan shrink the economy even more and give pressure on the private sector. The Business Council of Mongolia held its first meeting of 2017 on March 13 and one of the topics discussed of the meeting was implications of IMF’s Extended Fund Facility Program on the Mongolian economy. Deputy Governor of the Bank of Mongolia B.Lhagvasuren noted that previous authorities had spent a huge amount of money or around USD8 billion inefficiently for the last four years and it caused current difficulties. “We should demand and express our position incessantly, as Governments hear the citizens' voice in times of economic difficulties” said economist D.Jargalsaikhan. The Government decided not to raise salary till 2019. Certainly, it is not good news for public employees. However, inflation is at a relatively low level and this tendency is expected to be kept in future. Therefore, the risks such as real income of citizens to be lowered or devalued have been reduced, the attendees underlined.