Azerbaijan, Baku, June 19/ Trend , I. Khalilova /
On June 19, the Parliament of Azerbaijan ratified the draft of amendments and additions to the Tax Code.
The chairman of the Parliamentary committee on economic policy Ziyad Samedzade said that the amendment (46) to the tax legislation are envisaged in four directions - improving the rights and protection of the interests of taxpayers (19), improvement of tax administration (16), tax control (7) and editorial changes ( 4).
The amendments envisage reducing the rates on certain types of direct taxes from January 1, 2010. The rate of profit tax will be reduced from 22 percent to 20 percent, the maximum amount of income tax for hired employees will be reduced from 35 percent to 30 percent, and for individuals engaged in entrepreneurial activities, without creating a legal entity - from 35 percent to 20 percent.
Changes are also envisaged in simplified tax system. In particular, currently under the simplified tax system, the tax is paid by the individuals and entities whose quarterly turnover does not exceed 22,500 manat. From next year, legal entities with an annual turnover of up to 150,000 manat will be subject to simplified taxation system, and individuals - with an annual turnover of 90,000 manat. If physical and legal entities exceed the limit, within 10 days they must be registered by the Ministry of Taxes as VAT payers.
Preschool education institutions are also envisaged to be exempted from VAT from 2010. Also the innovation in the improvement of tax administration is to provide invoices electronically. As a result, Azerbaijan will become the first country in Eastern Europe and CIS, introducing online invoice.
Considering that submitting tax declaration in Azerbaijan is realized electronically, reports on the VAT and the simplified system are suggested to be submitted once a year.
According to Samedzade, simplified tax system allows to successfully carry out the forecasts, improve the business climate and tax policy in the light of international experience.
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