VAT could go down in 2009
The Value Added Tax (VAT) applied in Azerbaijan could be lowered in
2009, officials said.
"Reducing the VAT rate depends on the efficiency of applying the system of accumulation of revenues from VAT in a centralized manner," Minister of Taxes Fazil Mammadov said in the northwestern city of Ganja on Friday.
Since January 1, the proceeds from VAT are being collected on a single depositary account in the State Treasury.
"We will analyze the results of the first quarter, and if this mechanism proves effective, we will offer a reduction of the tax rate by 1% [to 17%] since next year. However, the issue will be considered again in the following years," the minister said.
Mammadov said the ministry was interested in enforcing the measure as part of the efforts to boost entrepreneurial development in the country.
According to research, the optimal VAT rate given Azerbaijan's current taxation environment is 14-15%. The government therefore intends to lower it annually by 1% over the next three years to ensure transparency in VAT collections.
"Reducing the VAT rate depends on the efficiency of applying the system of accumulation of revenues from VAT in a centralized manner," Minister of Taxes Fazil Mammadov said in the northwestern city of Ganja on Friday.
Since January 1, the proceeds from VAT are being collected on a single depositary account in the State Treasury.
"We will analyze the results of the first quarter, and if this mechanism proves effective, we will offer a reduction of the tax rate by 1% [to 17%] since next year. However, the issue will be considered again in the following years," the minister said.
Mammadov said the ministry was interested in enforcing the measure as part of the efforts to boost entrepreneurial development in the country.
According to research, the optimal VAT rate given Azerbaijan's current taxation environment is 14-15%. The government therefore intends to lower it annually by 1% over the next three years to ensure transparency in VAT collections.
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