Azerbaijan proposes to facilitate taxation of small and medium-sized enterprises
Azerbaijan, Baku, May 3 / Trend A. Hasanov /
To further improve the business climate for small business in Azerbaijan it's necessary to carry out institutional reforms, under which it would be appropriate to establish the National Agency for Small Business and the establishment of the post - the National Ombudsman, the head of Center for Political and Economic Studies, Sabit Baghirov, believes.
He made these proposals during the conference, entitled "Ways of development of small businesses".
"To support the development of small businesses it's necessary to conduct both institutional and regulatory reforms, simplify tax regime, improve the system of licensing, register property rights, strengthen information system and other measures," Baghirov told Trend on Thursday.
As part of simplifying the tax regime, he said, it would be advisable to increase the limit of turnover in the simplified taxation system. At present, legal entities with an annual turnover of up to 150,000 manat are subject to simplified taxation system, and individuals - with an annual turnover of up to 90,000 manat. In case of excess by individuals and legal entities of the limit, they shall, within 10 days to register with the Ministry of Taxes as VAT payers.
Simplified tax is calculated on the amount of funds received from the provision of goods, works and services by payers of this tax, and on non-operating income at a rate of four per cent of the city of Baku, and two per cent - in other towns and regions.
Legal persons - payers of simplified tax are exempt from VAT, income tax, property tax, individuals engaged in entrepreneurial activities without establishing a legal entity - from tax on income and VAT.
"It would also be appropriate to allow, starting with 2013 to small and medium-sized enterprises to use part of taxable income (up to 20 percent) for the expansion of activities," Baghirov said.
He said it's also necessary to develop tax booklets targeted at specific areas of small businesses, and publish them in large numbers.
As part of strengthening information system it's proposed by state funds to attract private consulting firms to provide free consultations to entrepreneurs.
The official exchange rate is 0.786 AZN to $1 on May 3.