Taxation of Small Businesses in Uzbekistan and Slovakia: A Comparative Analysis

This study compares the taxation of small businesses in Uzbekistan and Slovakia under the rules in force on 27 October 2026. Uzbekistan taxes most small firms on gross revenue through a 4% turnover tax (1% for individual entrepreneurs) that replaces both value-added tax (VAT) and profit tax, whereas Slovakia taxes net profit at a reduced 10% corporate rate, backed by a minimum tax and, for sole traders, a 60% lump-sum expense deduction. Using comparative legal analysis and stylised tax simulations, the study finds that Uzbekistan's turnover tax imposes a heavier direct-tax burden than Slovakia's profit tax whenever a company's net margin falls below about 34%, and that the gap becomes severe in low-margin trade. The simulations also show that Slovakia's mandatory social contributions make it far more costly for the smallest sole traders, and that part of Uzbekistan's turnover tax substitutes for VAT. The study recommends that Uzbekistan open a profit-based option, measured on actual costs, for low-margin firms below the turnover-tax threshold, while retaining its low fixed social contribution.