Ministry for economic development designs bill on Export of Oil Products

Business Materials 1 June 2006 11:11 (UTC +04:00)

The Ministry of Economic Development has submitted to the ministries concerned and administrations an updated version of the draft law on Export of Oil Products, which will enable to decrease tax burden of the foreign companies, which have been registered in Azerbaijan and carry out operation out of the country.

The government told Trend that the draft law was designed amid the proposals, that the government received from BosShelf and Maersk on granting of tax privileges for participation in the regional projects implemented out of the country. Special taxation regime is applied in the activities of these companies, as well as others involved in oil and gas operations. However, some companies accept contracts in Kazakhstan due to the nearing completion of activities under the projects in Azerbaijan.

BosShelf and Maersk requested to release from VAT, profit taxes and income taxes. The tax privileges will be included in the initial variant of the draft law, while the second variant differs in terms of privileges. The initial variant was also supposed to include taxes from the source in the amount of 5-6% for companies. Such companies will have to pay royalties and property tax. The profitability ratio was defined as 20% in the document. The bill might undergo some changes as a result of discussions, a source at the government said.