Sunday June 16 2024

Azerbaijan boosts investment in renewables through tax incentives ahead of COP29 [COMMENTARY]

23 May 2024 08:30 (UTC+04:00)
Azerbaijan boosts investment in renewables through tax incentives ahead of COP29 [COMMENTARY]
Nazrin Abdul
Nazrin Abdul
Read more

Tax incentives are being introduced in Azerbaijan in connection with the upcoming 29th session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP29). This initiative involves proposed amendments to the Tax Code, which were deliberated upon during a session of the Azerbaijani parliament.

Under the proposed amendment, non-resident individuals engaged in supplying goods, performing work, or providing services related to COP29 will be eligible for a nine-month exemption from income tax, commencing on March 1, 2024.

In his comment to Azernews on the issue, Vugar Bayramov, Azerbaijani MP and economist, announced that tax benefits will be extended to non-residents starting from March in connection with COP29.

"Proposed legislative amendments will grant non-residents engaged in COP29 activities exemptions from virtually all taxes. These tax benefits will be applicable for a period of nine months, starting from March, and once the practical changes are approved, they will retroactively apply to all activities commencing in March. Although March has passed, activities falling within that month will still qualify for the tax benefit."

Bayramov also highlighted that implementing such benefits will attract more investment.

"Preliminary assessments suggest that these concessions aim to attract more investment overall and facilitate the transfer of technology and innovation."

Moreover, the economist emphasized the significance of these concessions in terms of employment.

"Applying these concessions is also crucial for employment because attracting more investment, including foreign companies, will create new job opportunities."

The economist noted that this is one of the significant concessions regarding the transition to green energy.

"Undoubtedly, it's one of the significant concessions concerning the transition to green energy. It's necessary to apply such concessions to attract innovative technology. Therefore, it will accelerate and promote the transition to green energy, and as a result, it's deemed important to release tax benefits for activities carried out within the framework of COP29, as well as achieving green energy goals in Azerbaijan in a shorter period."

Economic expert Rashad Hasanov, in his statement, emphasized that the concession will encourage active participation in the private sector in this field.

"The decision is temporary and specific in scope. Its aim is to optimize the costs of activities related to the COP29 conference and encourage active participation of the private sector in this field."

He also pointed out that beneficiaries of the tax exemption will offer services at more competitive prices as a result of reduced additional costs.

"Therefore, non-residents involved in projects related to COP29 are exempted from paying income tax in the Republic of Azerbaijan due to the income derived from these activities. As a result, this allows those individuals to offer services at more competitive prices by reducing their additional costs."

Azerbaijan is implementing tax benefits for non-residents involved in activities related to the COP29 conference, aiming to foster investment, particularly in green energy, and promote technology transfer and innovation. These tax concessions, applicable for a nine-month period starting from March, are expected to not only attract more investment but also generate employment opportunities. The move underscores Azerbaijan's commitment to advancing its green energy agenda and supporting initiatives aimed at combating climate change.


Follow us on Twitter @AzerNewsAz

Latest See more