The excess profit tax is a tax levied on additional income received by a subsurface user in excess of the standards established by tax legislation. For the first time in its modern form, the NSP was introduced in the United States during the First World War as a tax on excess profits of corporations supplying weapons. In Kazakhstan, before the introduction of the Tax Code, fixed (rental) payments were applied with a similar purpose for the NSP. They were applied to large enterprises producing oil, gas and coal, the production of which, according to experts, was highly profitable in comparison with the extraction of other minerals.
The alternative subsurface use tax may be applied instead of the payment for the reimbursement of historical costs, the mineral extraction tax and the excess profit tax by legal entities-subsurface users who have concluded a contract in accordance with the legislation of the Republic of Kazakhstan on subsurface resources and subsurface use:
- a contract for the production and / or combined exploration and production of hydrocarbons at a field (s) located entirely in the Kazakhstan sector of the Caspian Sea;
- a contract for the production and (or) exploration and production of hydrocarbons for fields with a depth of the upper point of hydrocarbon deposits specified in the mining allotment or the contract for the production or exploration and production of hydrocarbons in the absence of a mining allotment, not higher than 4500 meters and the lower point of hydrocarbon deposits specified in the mining allotment or the contract for the production or exploration and production of hydrocarbons in the absence of a mining allotment, 5000 meters and lower.
- This right is applied in the period from the date of conclusion of these subsurface use contracts until the expiration date of the corresponding subsurface use contract and is not subject to change.
- The notification of the application of this right is sent by the taxpayer to the tax authority at the location no later than thirty calendar days from the date of conclusion of the relevant subsurface use contract.