Azernews.Az

BAKU – The American Chamber of Commerce in Azerbaijan (AmCham) has made proposals to amend Azerbaijan’s tax laws, the group’s CEO said.

Nargiz Nasrullayeva told reporters that the proposals to the Tax Code cover improvements in the country’s taxation system, lowering some tax rates and calculation of the value added tax.

She said the suggestions include reducing income tax for private individuals. "We are offering to lower the maximum income tax rate to 20 percent and exempting earnings of up to 500 manats (around $630) from taxes altogether."

The maximum income tax rate levied from private individuals in the country is currently 30 pct, and this rate is applied to those earning over 2,000 manats ($2,515) per month. If the earnings are less than 200 manats, taxes are not applied to their portion worth the minimum wage, which equals 85 manats, while the remaining amount is subject to 14 pct tax. The same tax is paid by anyone making 200 to 2,000 manats per month.

Nasrullayeva said the proposed lowering of tax rates would not cause a reduction in state budget revenues.

"We believe that if most of the population pays taxes, more funds will flow into the budget. Since the tax rates are currently high, some are evading taxes."

Nasrullayeva said AmCham’s proposals also cover legislative amendments concerning a social insurance system and ways of improving tax administration. She added that the chamber was discussing its proposals with the ministries of taxes and finance.

AmCham organized a conference in Baku on Thursday aiming to outline the future tax reforms and discuss their possible impact on the country’s economy. The development of non-oil sector and competitiveness of Azerbaijan in comparison with other countries was also a subject of discussion during the Chamber's first Tax Conference, titled "Finding the Right Path". The program featured speakers from the private sector as well as government agencies and international organizations.

AmCham is the leading business association promoting the interests of business in the country. Established in 1996, AmCham is comprised of over 220 members active in every sector of the Azerbaijani economy. It represents 80% of all foreign and a significant portion of local investment in Azerbaijan.