Mongolia May Reduce Tax Burden by 5 Percent by 2030

Key points:

The Government of Mongolia has set a goal to reduce the real tax burden on taxpayers by 5 percent between 2026 and 2030. This target is included in the country’s core development strategy for that period and is expected to be formally approved during a session of Parliament.

The reduction is planned to be gradual, decreasing the tax burden by 1 percent each year.

As part of the 2026 tax policy, the government has already decided to increase the VAT refund to 50 percent for purchases of up to 1 million MNT. The measure is designed to stimulate consumer spending and support small and medium sized businesses.

The government has also pledged to improve the business climate and remove barriers that prevent companies from entering the market. By 2029, the overall business environment rating is expected to reach 3.11 points under international assessment indicators, compared to 2.71 in 2023.

Another strategic objective is to raise foreign direct investment inflows to 6.6 billion US dollars over the next five years. Last year, total FDI inflows amounted to approximately 4 billion US dollars.

The government also plans to strengthen mechanisms that protect the rights of foreign investors. Currently, only about 25 percent of investor complaints are resolved, which officials believe has a negative impact on the investment climate and requires improvement.

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