. The foreign exchange fund is 40 percent of cash from gas sales. The primary issue is to regain lost export markets not revision of the gas taxation regime. Table 13 provides estimates of revenue from the energy sector. These figures exclude two types of revenues. In 1993-94 and partly in 1995, gas export arrears were at the end of the year rescheduled as government to government loans between Ukraine and Turkmenistan. The interest and repayments on such loans are not paid to the exporter (Ministry of Oil and Gas) but to the off-budgetand nontaxed Foreign Exchange
deficit, and curtail tax exemptions. Directors welcomed the creation of a unified revenue authority, which they saw as a major step in strengthening tax and customs administration. Directors also noted that the planned reactivation and strengthening of the RSF—to make it more transparent and flexible—should be an integral tool of prudent fiscal policy. They recommended a comprehensive review of the country’s fiscal management entailing a public expenditure review by the World Bank; a review of fiscal standards and codes; a revision of the gas taxation regime in line
exporters. Another initiative recently approved in Parliament was the transformation of Free Zones into Special Economic to attract new dynamic industries and foster economic diversification. Bolstering fiscal sustainability and resilience are also priorities in reform efforts . Following the 2018 restructuring of the state-owned oil company, Petrotr in, the authorities are poised to continue with SOE reform by rationalizing transfers, particularly for those enterprises providing water and electricity. In addition, a comprehensive review of the oil and gas taxation
deficit through expenditure restraint, broadening the tax base, and curtailing exemptions. The reactivation and strengthening of the RSF (to make it more transparent and flexible) could be an integral tool of prudent fiscal policy. A comprehensive review of the country’s fiscal management is recommended. This should entail a PER conducted by the World Bank; a review of fiscal standards and codes conducted by the Fund; an evaluation of the gas taxation regime—in line with FAD’s earlier recommendations; and a review of the VAT. The budget should be transparent and
focused on improving the country’s competitiveness, and doing business environment, including modernizing the current Free Zone regime, introducing e-Government and digital economy, and promoting the tourism sector. The authorities pointed out that the establishment of the new revenue authority seeks to facilitate trade by reducing transaction costs. Moreover, comprehensive review of the oil and gas taxation regime will soon be conducted to ensure that the domestic hydrocarbon sector remains internationally competitive. The authorities reiterated their strong commitment