Some changes to Azerbaijani Tax and Labor Codes aimed at strengthening control over taxpayers - PwC

Economy 14 January 2022 17:37 (UTC +04:00)
Some changes to Azerbaijani Tax and Labor Codes aimed at strengthening control over taxpayers - PwC

BAKU, Azerbaijan, Jan. 14

By Sadraddin Aghjayev - Trend:

Amending the Azerbaijani Tax and Labor Codes is one of the tools to strengthen control over taxpayers, Movlan Pashayev, managing partner of PricewaterhouseCoopers (PwC) Azerbaijan, said in an interview with Trend.

Pashayev said that transfer pricing is considered one of the trends in the global tax administration and Azerbaijan is not the exception from this point of view.

“So, for example, the world practice of transfer pricing is aimed at preventing artificial underestimation or overestimation of transactions,” the managing partner added. “Accordingly, the changes that have been made to the Tax and Labor Codes are in line with the global trends.”

Pashayev added that on the other hand, as these norms and laws are new for our country, their application is not yet clear to everyone and sometimes the interpretation raises questions among taxpayers.

“Therefore, I think that the events are expected to be developed in this sphere,” Pashayev said. “One of the topical issues of the Azerbaijani banking system is to reduce the interest rate of lending to small and medium-sized businesses.”

Pashayev added that Azerbaijan, as opposed to other countries, has its own structure and specifics of the economy.

“The small and medium-sized businesses, in accordance with the law, are provided with certain privileges, preferential lending in Azerbaijan,” managing partner stressed.

Pashayev stressed that however, the interest rates for lending to SMEs by banks are quite high compared to other countries.

“I think that today the issue of lowering interest rates of lending to these entities must be on the agenda of banks,” Pashayev said.

The managing partner stated that presently, PwC Azerbaijan has over 60 audit clients.

“The quality of the financial statements that we audit is being improved, the companies understand and appreciate financial statements better,” Pashayev said. “An audit shows the real state of the company and creates the basis for making certain decisions.”

“We conduct an audit, which is also of a strategic nature, for example, an audit of the State Oil Fund of Azerbaijan,” the managing partner added. “It is planned to start an audit of the Karabakh Revival Fund, as well as a number of other state and private companies from 2023. I am glad that the quality of financial reporting is being improved and the attention to auditing is being increased every year.”

“It is necessary to stress the role of the Chamber of Auditors, which monitors the work of local audit companies and helps to resolve the emerging issues,” Pashayev said. “I think that the quality of the audit and its correct use depends on the company that orders the audit.”


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