Azerbaijan, Baku, November 25 / Trend, I. Khalilova /
Twenty per cent of Azerbaijan's non-oil GDP will be tax-free as the country's agriculture economy becomes exempt from taxation.
The introduction of tax breaks for another period of five years is an important element of the country's budgetary policy because there is a large taxable base, which from now on will be tax-free, Tax Minister Fazil Mammadov told Parliament yesterday. He was speaking at examination of the draft of state budgets for 2012 and three following years.
"Thanks to these tax preferences, agriculture is expected to produce 2.4 billion manat as added value this year, an increase of six per cent against last year," the Minister said.
The Government's economic policy aims to stimulate the development of separate economic branches and keep them sustained throughout the introduction of targeted tax preferences for a certain period of time.
"Thus, the Government continues to support agricultural producers through tax preferences even despite the fact that agriculture yields more than 20 per cent of non-oil GDP," Mr Mammadov noted. Previously tax preferences for domestic agricultural producers who were previously freed from all but land tax, were extended for a period of five years in 2009.
In 2011, the indirect subsidies to the agrarian sector are expected to have reached 150 million manat. Azerbaijani farmers were issued subsidies worth a total of 425 million to 430 million manat over the past four years, Agriculture Minister Ismat Abbasov reported earlier.
"The Government plans to continue to support farmers," the Minister noted.
Subsidies for the purchase of motor oil and fuel equivalent to 40 manat per hectare of area under agricultural crop use are assigned in accordance with the President's decree on the provision of state financial support to agricultural producers.
A countrywide commission comprising 57 regions took a decision on the assignation of 51.64 million manat as state budget subsidies to the agricultural producers this year.
The subsidies are being given to 381,495 agricultural producers from 1383 regional commissions to compensate for costs relating to the purchase of fuel and motor oil to cover working within 1,290,883 hectares of areas under agricultural crops.
The official exchange rate on November 25 is 0.7865 AZN/USD.