In 2007, it is expected, with the initiative of the Taxes Ministry of Azerbaijan, to strengthen the system of administration of value added tax. According to the project of changes and annexes to the Tax Code, from the next year, the tax payers of this type will have to open a separate bank account, in which VAT will be paid, a government source told Trend.
This proposal had been put forward two years ago, but due to the lack of support from the banking sector and several state bodies, it wasn't included in the Code. It wasn't excluded by the government that this time the issue will be deeply discussed by the public.
The President of the Association of Banks of Azerbaijan Eldar Ismaylov stressed that such innovations require additional expenses for the banking sector because the programs of international standards don't allocate such separate accounts. Accordingly, a technical difficulty will appear at the beginning till making corrections to the program provision. In addition, Ismaylov considers that it needs to proceed from requirements.
It is considered at the Taxes Ministry that together with negative sides, there are positive sides of the separate bank account for VAT, but in the current situation, it is a very important step. The reason for positive factors is that it will allow strengthening the control and upgrading account and collection of this tax.
Among the other measures in 2007, it is expected to toughen the financial sanctions with regard to cash accountings with population and breaking the rules of cash registers. It is intended in the project of changes and annexes to the Tax Code to realize gradation in the sanctions. Depending on the number of the breaks by the tax payers, the volume of the sanction will be increased and such gradation has been installed in three phases, and in the fourth stage, the tax bodies may appeal to the court instance to take measures to close the facility of the infringer.