Azerbaijan, Baku / Trend corr I. Khalilova / The Azerbaijani National Entrepreneurs Confederation (ANEC) has begun the development of proposals on the Tax Code, the amendments to which will be approved by the parliament within the framework of the 2008 public budget.
According to the head of ANEC, Alakbar Mammadov, proposals from business circles will be submitted in September, as it was in previous years.
"We want to suggest decreasing the tax burden in the next year and we have developed proposals on reconsideration of VAT and income tax tariffs. Recently we have visited Bulgaria where tax income is 14%. A decrease of the tax burden in Azerbaijan will lead to an increase in the number of tax-payers. Thus, the state will not lose," Mammadov said.
It will be suggested to cut income tax down to 16-18%, VAT down to 14%, while at present they are 22% and 18% respectively.
The head of the ANEC considers tariffs on obligatory social payments to State Fund on Social Protection (25%, with 22% paid by employers and 3% by employees) to be too high for Azerbaijan.
A high tax burden results in the development of an informal sector. "The matter concerns an increase in numbers not only of enterprises that have not been registered at tax bodies, but those who keep double books, which is mainly in response to social insurance payment requirements," Mammadov said.