IMPROVING THE SOCIAL TAX SYSTEM IN UZBEKISTAN
DOI:
https://doi.org/10.5281/zenodo.19694699Keywords:
social tax, payroll tax, labor market, informality, Uzbekistan, social insurance, wage costs.Abstract
Social tax — listed as the ninth tax in the enumeration of Article 17 of the Tax Code of the Republic of Uzbekistan (2019) — constitutes a critical link between the fiscal system and social insurance financing. This article examines the structure of the Uzbek social tax, its incidence on employers and employees, its labor market effects, and the fiscal sustainability implications of its current design. Drawing on labor economics literature and evidence from comparable transition economies, the study analyzes how social tax rates and bases affect formal employment, wage levels, and the incentive to operate in the informal sector. The paper finds that high marginal social tax burdens on formal employment are a significant contributor to informality in Uzbekistan and proposes a reform framework for improving efficiency while maintaining adequate social insurance financing.
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