Azerbaijani Business Assistance Fund Offers to Improve Business-Climate
Azerbaijan, Baku, 8 October / Trend corr. U.Ismayilova / "The Azerbaijani State Entrepreneurship and Market Economy Assistance Fund made its proposals on reforms in 2009 in its National agenda on improvement of business-climate, which describes main directions of further improvement of conditions for entrepreneurial activity," Sabit Bagirov, the head of the fund said.
The fund offers, basically, reforms in the field of institutional development, introduction of the European definitions of small business, regulative reforms, softening of tax regime, reforms for licensing system, development of infrastructure of small entrepreneurship, toughening punishment measures for commercial activity without invoice, ordering inspections, providing supremacy of law and justice in courts and improvement of foreign trade procedure.
The fund believes in reasonability of establishment of a special state agency to support small business. Main task of establishment of such an agency is to provide state care over small business, the most vulnerable field of the private entrepreneurship.
Another direction to provide small business with state care is to establish institution of the state or national ombudsman on small business. Such institutions have been established in the United States and Poland. Tasks of the national ombudsman are to protect interests of small business from excessive and burdensome state regulation, control and various fines.
Transfer to the European definition will enable to use better experience of the European countries on support to development of small business. Use of general conceptions will give opportunity for proper collations and analyses not only in issues of development of small business, but also its role in economy of the country.
The fund offers to triple limit on turnover amount for the simplified taxation system in 2009 and to introduce tax breaks for small and medium enterprises, including VAT payers), in the first year of their activity. It is reasonable to introduce requirements to pay annual amount of the unpaid tax in line with normative documents, which are connected to legalization of suspensions of enterprises, in order to prevent such privilege from being a reason to suspend these enterprises by their owners after one-year period of their activity[E1] .
It is offered to cut VAT rate to 10% on food products of the first necessity, to simplify order of VAT reimbursement in 2009, to carry out payments from taxable income of small and medium enterprises and part of capital expenditures to expand activity to 20% of taxable income.
Amendment, which sets amortization norm of capital investment for software products at 50%, is offered to be injected into the Tax Code in 2009.
At present, more than 60,000 small, medium and big private companies function in Azerbaijan. Small enterprises comprise 20% of the total. Entrepreneurial activity has developed without creation of juridical figure in the country. Currently such businessmen number to more than 260,000 in the country. Party of private sector at GDP makes up 84%, including activities of transnational oil companies.
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