BAKU, Azerbaijan, April 22
By Eldar Janashvili - Trend:
The social insurance burden is planned to be reduced for employees making fixed payments in Azerbaijan, Trend reports on April 22 referring to Azerbaijani Ministry of Taxes.
In accordance with the Action Plan approved upon the resolution of the Cabinet of Ministers on April 4, 2020, the Azerbaijani Ministry of Taxes has been charged with providing entrepreneurs working in the spheres affected by the pandemic with tax benefits and vacations.
To reduce the social insurance burden, a proposal was made to provide taxpayers operating by making fixed payments with the minimum monthly salaries in a differentiated manner depending on the district, as well as to simplify the administrative procedures and social insurance payment on compulsory state social insurance.
Currently, individual hairdressers in Baku pay the tax worth 30 manat ($17.6) and social insurance worth 62.5 manat ($36.8), that is, the total tax and social burden is 92.5 manat ($54.4). After making the changes, the hairdresser will pay the tax worth 30 manat ($17.6) and social insurance worth 15 manat ($8.8). The total tax and social burden will be reduced to 45 manat ($26.5) or by 47.5 percent.
Taxi operators in Baku currently pay the tax worth 18 manat ($10.5) and social insurance worth 62.5 manat ($36.8). The total tax and social burden is 80.5 manat ($47.3). After making the changes, these people will pay the tax worth 9 manat ($5.3) and social insurance worth 30 manat ($17.6). In general, the total tax and social burden will be reduced by 51.5 percent ($30.3) to 39 manat ($22.9).
The social insurance burden optimization project also envisages setting of the social insurance burden of lawyers, freelance accountants and auditors in the amount of 10 percent by deducting the expenses on the received income.
The package of proposals on tax incentives was widely discussed with the state structures and public organizations of entrepreneurs, including the National Confederation of Entrepreneurs (Employers’) Organizations, the Azerbaijan Banks Association, as well as with business entities operating in individual sectors within the working group created to assess the negative impact of the coronavirus pandemic (COVID-19) on the national economy.
In this regard, the Azerbaijani Ministry of Economy prepared proposals on the necessary amendments to the Tax Code and the Azerbaijani law "On Social Insurance". After re-consideration in the government, draft documents included in the package of proposals were submitted to the Azerbaijani parliament.
(1 USD = 1.7 AZN on April 22)
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