Azerbaijani Government will Reduce VAT Rate in Two Stages

Business Materials 16 November 2006 19:43 (UTC +04:00)

Azerbaijan Tax Ministry is not expected to reduce the rate of VAT (Value Added Tax) starting from the next year. The VAT rate is likely to be reduced only in 2008, Trend reports referring to Natig Amirov, Deputy increase the financial discipline of tax payers in the country, N. Amirov thinks.

According to him, the Government is about to reduce the VAT rate in two Taxes Minister.

We think that today, it is necessary to optimize 18% rate of VAT. However, prior to reducing the rate of the tax, it is first of al necessary to stages. Tax discipline is expected to be improved during the first stage. VAT-accounts are

expected to be introduced to the banking system starting from 2007 with this aim.

The Deputy Tax Minister thinks that reducing the rate might be carried out if the transition to VAT-accounts brings positive results. In any case, the rate is likely to be reduced not earlier than 2008.

In the next year, the VAT administration system is expected to be reinforced. In addition to the introduction of VAT-accounts, financial sanctions toward cash accounts with population, as well as violation of the rules of accounting via the cash registers are expected to be tightened in 2007.