THE IMPACT OF TAX INCENTIVES ON THE DEVELOPMENT OF SMALL BUSINESS
Abstract
This article examines the impact of tax incentives on the development of small businesses from a scientific and analytical perspective. Today, small business is an important component of the economy, and its development is closely related to the state tax policy. According to statistical data, small businesses in Uzbekistan account for about 51–52 percent of the country's gross domestic product (GDP) and play a significant role in economic growth. As of 2025, there are more than 1.2 million active small business entities operating in the country, contributing around 33 percent of industrial production, more than 75 percent of
construction works, and over 80 percent of retail trade turnover. The article analyzes the role of tax incentives in supporting small businesses, including reduced tax rates, temporary tax exemptions, and simplified taxation systems, and their impact on entrepreneurial development. In particular, the reduction of the turnover tax rate to 1 percent for certain micro-business entities is considered an important factor in reducing the tax burden on small businesses. The study concludes that tax incentives play a significant role in increasing investment activity, creating new jobs, and strengthening the competitive environment in the economy.
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