According to Interfax, the Majilis, the Lower Chamber of the Kazakhstani Parliament, has approved a proposal of the Ministry of Finance to abolish double taxation for CIS countries and to reduce the VAT rate to 10% for commodities that have the same VAT rate in Russia. Relevant changes will become law in the presidential decree "On Taxes and Other Payments to the Budget".

Kazakhstan intends to simplify the state regulation with regard to precious metals and stones. According to the executive director of the State Investment Committee Anvar Saidenov, the government proposes to abolish primary auctions where the state represented by the National Bank and Treasury of Kazakhstan, has the right of first refusal and to allow gold producers to sell their products at their discretion. Among other benefits, this will enable gold producers to use the gold loan mechanism in order to raise funds and to conclude trade deals without waiting for primary auction or the state to refuse purchasing gold. The state will retain some regulatory functions like licensing exploration and mining of gold and the conclusion of state contracts. A draft law will be elaborated to handle damping tendencies that may occur and relevant changes will be introduced in the Criminal Code (Interfax)

The National Pension Agency of Kazakhstan (NPA) has presented to the government a proposal that Kazakhstani open-end pension funds increase their minimum authorised capital from KZT55m (US $0.72m) to KZT90m (US $1.17m) and corporate pension funds—from KZT10m (US $0.13m) to KZT20(US $0.26m), Interfax reported. The agency has established these minimum capital requirements based on its estimations of fund viability requirements. Authorised capital should be exclusively formed of cash. In addition, the size of the pension fund's fee will be restricted (to 1% of pension deposits and 10% of investment revenue) thus causing pension funds to obtain an optimal number of clients.

To date, Kazakhstan has two corporate pension funds and nine open non-state accumulative pension funds. Plus, there are five management companies that have licences from the National Securities Commission to manage pension assets of the State Accumulative Pension Fund (SAPF). As of June 1, 1998, the amount of assets under their management exceeds KZT6.4bn (US $83m).

The State Pension Disbursement Centre is expected to complete the awarding of individual social numbers to Kazakhstani employees, pension fund clients, by July 1, 1998.

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On June 25, The World Bank approved a US $300m loan to Kazakhstan for pension reform. The World Bank stated, "The loan will support the government's efforts to finance the transition to a fully funded pension system by financing part of the estimated 1.7% of (GDP) fiscal deficit brought about by pension reform."(Reuters)

A summit of the leaders of Kazakhstan, China, Kyrgyzstan, Russia, and Turkmenistan will be held in Almaty on July 3 to address regional border and oil issues. Russian President Boris Yeltsin has cancelled his visit to Kazakhstan due to Russia's financial crises. According to a Kremlin spokesman, Foreign Minister Yevgeny Primakov will represent Yeltsin at the summit. A meeting of Yeltsin with President Nazarbaev due to be held before the summit has been postponed till September. (Reuters)