Benefits and preferences for Rustam Emomali

In 2024, the government of Tajikistan provided a large number of tax and customs benefits for the mayor’s office of Dushanbe, led by Rustam Emomali, the eldest son of the country’s president Emomali Rahmon. The eldest son of the president of Tajikistan has been serving as the mayor of Dushanbe since January 2017 and has also been the speaker of the Majlisi Milli (the upper house of the country’s parliament) since 2020.

According to Radio Ozodi, under the state budget law for 2024, the following companies and goods for the city of Dushanbe are fully exempt from customs duties, and only half of the VAT amount is charged:

• equipment, special purpose vehicles and spare parts for them, buses;
• State Unitary Enterprise “Production, Procurement, Storage and Sale of Essential Goods in Dushanbe” (an enterprise supplying food to Dushanbe) when selling food products and importing goods;
• low-sulfur fuel oil for the needs of the Dushanbe Thermal Power Plant. The supply of coal to the power plant is also a monopoly of companies close to the president’s family. The power plant is part of the state holding “Barki Tojik”;
• the construction of the “Ismoil Somoni” hotel, located on Rudaki Avenue in Dushanbe. The construction of this facility began in 2006 and has been ongoing for 18 years. The government of Tajikistan annually provides concessions for the construction of this hotel. Earlier, the Asia-Plus agency reported that the customer for the hotel construction is the executive office of the president of Tajikistan, and the contractor is the construction company “Ismoil Somoni – Asri XXI”. According to Asia-Plus, the company is headed by Rahmatullo Saidulloev, the brother of Hasan Asadullozoda, the chairman of “Orionbank” and the brother-in-law of the president.

• the construction of the National Theater of Tajikistan in Dushanbe, which began in 2015 and is still ongoing.
• the import of shady, evergreen, and decorative trees for planting in the parks, streets, and avenues of the capital;
• the import of DND 60/90 grade bitumen for the State Unitary Enterprise “Rokhsos” in Dushanbe.

It is unknown how much money the state treasury loses due to these benefits. However, a document in the possession of Radio Ozodi shows that only the State Unitary Enterprise “Production, Procurement, Storage and Sale of Essential Goods in Dushanbe” has received the right to import the following products into the country without paying customs duties:

• 50 thousand tons of sugar;
• 15 thousand tons of vegetable oil;
• 100 thousand tons of wheat;
• 10 thousand tons of flour;
• 2 thousand tons of rice.

Authorities previously stated that such benefits were granted to the mayor’s office of Dushanbe to reduce the prices of essential goods in the capital’s markets. However, reports from the UN Food Program indicate that food prices in Dushanbe’s markets are not different from market prices in other regions of the country, and in some cases are even inflated.

For example, one kilogram of sugar in Dushanbe costs an average of 11.2 somoni, and its price in the capital is almost the same as in other regions. The only exception is the Gorno-Badakhshan Autonomous Region, where sugar is more expensive than in the capital region. The average price for one liter of vegetable oil, imported to the capital with customs and tax benefits, is 17.6 somoni. In Bokhtar, this oil costs only 14 somoni, in Kulob – 14.8 somoni, and in Khujand – 15 somoni.

An investigation by Radio Ozodi revealed that no other cities or districts in Tajikistan can boast similar preferences. In previous years, special concessions and budget advantages were mainly granted to the Danghara District. At that time, according to media reports, the budget of this single district was equal to the budget of 13 other districts in the Khatlon region. Now, all attention has shifted to Dushanbe.

According to official data, such generous preferences for the capital’s mayor’s office were not provided before Rustam Emomali was appointed chairman of Dushanbe. Thus, in 2016, a year before Rustam Emomali was appointed mayor of Dushanbe, the government exempted the mayor’s office from taxes only for the import of passenger vehicles, fuel oil for the heating plant, and construction materials for the construction of the “Ismoil Somoni” hotel.

Very large benefits have been granted this year to the Football Federation of Tajikistan, headed by Rustam Emomali – the federation itself and the country’s football teams pay only 50% of the property tax. Coaches and players invited from abroad are exempt from paying 50% of personal income tax.

There are 43 sports associations and federations registered in Tajikistan. However, tax and customs concessions have only been granted to the Football Federation, which has been headed by Rustam Emomali since 2012. This privilege has been retained by the FFT since 2019, and it is unknown how long the benefits for this federation and football teams will last.

Narzullo Malikzoda, deputy chairman of the Tax Committee of Tajikistan, reported in February of this year that under the new Tax Code, additional tax benefits are granted for a period of no more than five years. However, these restrictions do not seem to apply to the city of Dushanbe and certain companies related to the family and close associates of President Emomali Rahmon. In particular, the exemption from taxes and customs duties for the construction of the “Ismoil Somoni” hotel has been ongoing for more than 15 years and has since expanded to other sectors unrelated to construction.

Providing privileges for the Dushanbe mayor’s office is not the only preference for Rustam Emomali. In 2017, after his appointment as mayor of the capital, the government of Tajikistan mandated 48 ministries and agencies to build sports facilities throughout Dushanbe as part of the city’s improvement efforts. This applied even to those ministries and agencies whose activities are not related to construction and architecture – all were required to build sports or children’s playgrounds, as well as other facilities. For example, the government of the Sughd region was tasked with renovating the Sadriddin Ayni Park in the capital, which completed all work by November 2017. Additionally, the budget of the Khatlon region was used to renovate the Abulkosim Firdavsi Park in Dushanbe.

State media widely cover Rustam Emomali’s activities as mayor of the capital and call him a successful manager. However, critics question his achievements in this important position, considering the numerous complaints from residents about power and heating outages during the winter period. Since the end of February this year, there have been rolling power outages in the city’s neighborhoods. Previously, the “electricity limit” was not applied to Dushanbe during winter. Due to the lack of electricity, many families began using coal, and several people died from carbon monoxide poisoning this winter in the capital, including two families with small children.

For several days recently, some areas of Dushanbe have been without drinking water, yet neither the mayor’s office nor other competent authorities informed residents in advance about the water shutdown. It is also unclear whether anyone will be punished for this mess in the utilities sector. When a heavy snowfall hit the capital of Tajikistan, state media showed Rustam Emomali meeting with utility workers right on the snowy street to address the emerging problem.

Some consider Rustam Emomali a potential successor to his father for the presidential post. Currently, the 37-year-old Rustam Emomali is practically the second person in the power hierarchy and the most likely candidate for the head of state. He previously held positions as the chairman of the Customs Service and the director of the Anti-Corruption Agency.

In addition to the Dushanbe mayor’s office and the Football Federation, the government also provided tax benefits to companies associated with Rustam Emomali’s close circle. In particular, in 2021, LLC “Marmari” – a meat and poultry production company in the south of the country – was granted preferences for seven years, and in 2022, the government of Tajikistan exempted it from VAT and customs duties on the import of 140 types of goods, equipment, and machinery. An investigation by Radio Ozodi revealed that “Marmari” is run by people close to Rustam Emomali. The authorities have never commented on this issue.

Earlier, in their reports, the IMF and the World Bank pointed out the issue of providing tax breaks to a number of companies and enterprises in Tajikistan, calling this practice undesirable, as such a situation creates unhealthy competition, while the state budget loses significant revenues.