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TaxesLesson 26 min read · Updated: 9 November 2026

The seven elements of a tax: which questions do you need to answer to understand any tax?

The second lesson of the course: the seven elements of a tax under the Tax Code (object, base, rate, period, and the procedures for calculation, reporting and payment), and the concepts of taxpayer, tax agent and tax benefit, shown on the VAT of one furniture workshop.

If a friend tells you «a new tax has come out», what is the first thing you ask? An experienced accountant immediately asks several questions: who pays, what is it levied on, how much, for which period, how is it paid? The Tax Code has turned these questions into a ready-made list. The items on the list are called the elements of a tax. As promised in the first lesson, today we get to know them.

When is a tax considered «established»?

Article 69 of the Tax Code sets a strict condition: until all the elements of a tax are clearly specified in legislation, the tax is not considered established. There are seven elements:

  1. object of taxation;
  2. tax base;
  3. tax rate;
  4. tax period;
  5. procedure for calculating the tax;
  6. procedure for submitting the tax return;
  7. procedure for paying the tax.

Under the same article, tax benefits may also be provided for when a tax is established. Article 9 of the Code adds one more requirement: legislation establishing a tax must also clearly state who pays it.

The easiest way to memorise the list is to turn it into questions:

What is definedWhich question it answersIn the VAT example
TaxpayerWho pays?A business that is a VAT payer
Object of taxationWhat is taxed?Turnover from selling goods and services, import of goods (Article 238)
Tax baseWhat is it calculated on?Selling price excluding VAT (Article 248)
Tax rateHow much?12 percent (Article 258)
Tax periodFor what period?One month (Article 259)
Calculation procedureWho calculates it and how?The business itself (Article 74)
Reporting procedureWhere and in what form is the result submitted?To the tax authority, as an electronic document (Article 82)
Payment procedureHow is the money transferred?Through a bank, by bank transfer (Article 74)

The terms one by one: definition and mini example

The hero of our example is the «Archa mebel» workshop (hypothetical). It is a VAT payer, and this month it sold one table to a private customer, Sanjar, for 5 000 000 soum excluding VAT.

  1. Taxpayer. A legal entity or individual on whom the obligation to pay tax is imposed (Article 20). Mini example: the VAT payer on the sale of the table is «Archa mebel». Sanjar bears the tax inside the price, but he does not transfer it to the budget himself.
  2. Object of taxation. Property, an action, the result of an action or another measurable circumstance whose existence gives rise to a tax obligation (Article 70). Mini example: the table was sold, that is, sales turnover, which is an object of VAT, arose.
  3. Tax base. The value or other measure of the object on which the tax is calculated (Article 71). Mini example: for VAT the base is usually the value of the goods at the price agreed by the parties, excluding VAT. For the table the base is 5 000 000 soum.
  4. Tax rate. The tax per unit of the base, as a percentage or as a fixed amount (Article 72). Mini example: the VAT rate is 12 percent, so for the table it is 5 000 000 × 12% = 600 000 soum.
  5. Tax period. The period at the end of which the base is determined and the tax payable is calculated: a calendar year or another period (Article 73). Mini example: for VAT the tax period is one month, so the workshop adds up all its sales for the month at the end of the month.
  6. Tax return. The calculation that a taxpayer submits to the tax authority in the established form. Legal entities and individual entrepreneurs submit it as an electronic document (Article 82). Mini example: at the end of the month the workshop's accountant sends the VAT return to the tax authority electronically.
  7. Tax agent. A person on whom the obligation is imposed to calculate the tax, withhold it from the taxpayer and transfer it to the budget (Article 23). Under the Code, the tax is usually calculated by the taxpayer, but in cases provided for by the Code this task may be assigned to a tax agent (Article 74). Mini example: when the workshop pays wages to a carpenter, it withholds the carpenter's personal income tax and transfers it to the budget (Article 386). Here the workshop is the tax agent, and the taxpayer is the carpenter himself.
  8. Tax benefit. An advantage granted by law to certain categories of taxpayers, including the possibility of not paying tax or paying less (Article 75). An important subtlety: the possibility of deferring the payment deadline or paying in instalments is not a benefit. Mini example: Article 243 of the Tax Code lists sales exempt from VAT; a business that sells goods on that list does not charge VAT on that sale.

The glossary page for each term is in the links at the end of the page.

How is the price of the table built up?

IndicatorAmountWhich element
Price of the table excluding VAT5 000 000 soumTax base
VAT rate12%Tax rate
VAT amount (5 000 000 × 12%)600 000 soumCalculation procedure
Price Sanjar pays5 600 000 soumBase and tax together

Let us check with the method from the first lesson: 5 600 000 × 12 / 112 = 600 000 soum. The result is the same.

What does knowing the elements give you in practice?

  • You understand a new rule quickly. When a change is announced, you ask the seven questions in turn: which element has changed? The rate, the base or the period?
  • Errors become easier to find. For example, if an accountant mistakenly calculates VAT on the price including VAT, the result is 5 600 000 × 12% = 672 000 soum, that is, 72 000 soum too much. The error is not in the rate but in the base.
  • A work plan can be drawn up. An accountant who knows the tax period plans in advance when to calculate and when to submit the return.

In the next lesson

In the third lesson we will look at which taxes the Tax Code contains and how they are divided into direct and indirect taxes.

Test yourself

5 questions on this topic: pick an option or reveal the answer.

  1. After the tax payment deadline had passed, the accountant of "Bekobod sement savdo" found an error on his own that had understated the tax in the return. Under Article 83 of the Tax Code, in which case is the company released from liability if it files an amended return?

  2. "Zomin suv" did not pay a tax by the due date and paid it a few days late. Under Article 110 of the Tax Code, from what day and at what daily interest rate is penalty interest charged?

  3. "Mir texno" LLC is concluding an employment contract with a new employee. Under Article 127 of the Tax Code, what is the rule on the taxpayer identification number (TIN) in an employment contract?

  4. "Anhor shisha" LLC delivered glass containers to a buyer and issued an invoice. The parties then agreed to change the price of the delivered goods. Under Article 47 of the Tax Code, what must the seller do?

  5. In an advertising campaign, "Zarbdor mebel" LLC gave away 20 chairs to customers for free. Under Article 46 of the Tax Code, is a free-of-charge transfer of goods a supply (realization)?

Answered: 0 / 50 of 5 correct

All tests →

See also

Sources

  1. Tax Code of the Republic of Uzbekistan, Article 9, part 1 · legislation establishing a tax must define the taxpayers and all other elements of the tax
  2. Tax Code, Article 20, part 1 · concept of taxpayers
  3. Tax Code, Article 23, part 1 · concept of tax agents
  4. Tax Code, Article 69 · the seven elements of a tax; a tax is considered established only when all elements are defined; tax benefits may be provided for
  5. Tax Code, Articles 70–73 · object of taxation, tax base, tax rate, tax period
  6. Tax Code, Article 74, parts 2, 3 and 8 · the taxpayer calculates the tax independently; in cases provided for by the Code this obligation may be assigned to the tax authority or a tax agent; legal entities and individual entrepreneurs pay tax by bank transfer through banks
  7. Tax Code, Article 75, parts 1 and 2 · concept of a tax benefit; deferral or payment in instalments is not a benefit
  8. Tax Code, Article 82, part 3 · legal entities and individual entrepreneurs submit tax returns as electronic documents
  9. Tax Code, Article 238, part 1 · object of VAT: turnover from the sale of goods (services) whose place of sale is Uzbekistan, and the import of goods
  10. Tax Code, Article 248, part 1 · VAT base: the value of goods (services) based on the price applied by the parties to the transaction, excluding VAT
  11. Tax Code, Article 258, part 1, and Article 259 · VAT rate 12 percent; the tax period is one month (unless Chapter 39 provides otherwise)
  12. Tax Code, Article 243 · turnover exempt from VAT
  13. Tax Code, Article 386, part 1, clause 1 · a legal entity of the Republic of Uzbekistan paying income to an individual is a tax agent obliged to calculate, withhold at source and transfer to the budget personal income tax
  14. Examples, names and figures · compiled by the author, hypothetical

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