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Azerbaijan to raise ceiling limit on quarterly turnover for simplified tax for legal entities

11 June 2009 16:35 (UTC +04:00)

Baku. Vahab Rzayev - APA-Economics. According to the bill on Amendments to the Tax Code, it is proposed to ceiling limit on quarterly turnover for simplified tax for legal entities but leave unchanged for individuals.

Under existing paragraph in the Tax Code, â€œa person engaged in entrepreneurial activities, whose taxable transactions for the previous 3 months exceeded 22 500 manats (except persons referred to in paragraph 218.1.1.1 of the Code), is required to apply to tax authority for VAT registration within 10 days of the conclusion of this periodâ€.

The suggested wording is as follows: â€œa legal entity engaged in entrepreneurial activities, whose taxable transactions for 12 months exceeded 150 000 manats (AZN 37 500 per quarter), and a natural person, whose taxable transactions for the 12 months exceeded 90 000 manats (AZN 22 500 per quarter) (other than those referred to in paragraph 218.1.1.1 of the Code), are required to apply to tax authority for VAT registration within 10 days of the conclusion of this periodâ€.

Note that paragraph 218.1.1.1 refers to entities engaged in passenger transport.

Given that the entrepreneurs who are not VAT payers pay simplified tax, it is proposed to expand the list of simplified tax paying legal entities.

That is, given that legal entities (as individuals) pay a simplified tax if their annual turnover is up to 90 000 manats, this limit will be raised to 150 000 manats if the amendment is approved.

This amendment can be interpreted in favor of small and medium-sized businesses.