Do Mongolians like paying taxes? The 2017 tax revenue figures would appear they do – tax revenue exceeded the state budget plan by MNT 1 trillion 300 billion; double that of the previous year.

In a country where a large part of the population lives below the poverty line this seems hard to believe. The answer clearly is the state lottery – under the 2015  amendment to the value added tax law, consumers can collect their receipts from supermarkets, various retail outlets and other services, for which they get a 2 percent cashback and the chance to become lottery millionaires.

The VAT refund has really worked. There has been a sharp rise in the registration of tax payers. Previously, only 40 percent of Mongolian enterprises paid VAT regularly.

In the 2018 state budget, the government expects revenue from taxes to increase by 607 billion MNT or 10.7 percent compared to the total expected revenue in 2017. The main factors for the increase will be increases in income tax, social insurance, and VAT revenue. In 2017, seven types of taxes were increased as part of the agreement with the International Monetary Fund (IMF) to enroll into the extended fund facility. These are not proving so popular and trade union leaders in the mining sector are already voicing the concerns of their members.