- What were the impacts of global financial and economic crisis and sharp decline in oil price on the work of customs service of Azerbaijan?
- Local products increased by directing the oil incomes to the non-oil sector on the basis of diversification principles a result of successful economic policy conducted by Azerbaijani president Ilham Aliyev and economic reforms are being conducted to stimulate exportable products. Azerbaijan has already entered the post-oil period. A competitive environment has been crated between local products and imported products in the consumption market by taking complex measures for development of non-oil sector and this leads to regulation of good prices in the market. As a result of recent reforms conducted in the customs system, the customs infrastructure was modernized, state budget incomes increased, modern tariff and non-tariff regulation measures were applied in import and export operations, automatized management and information technology were applied in the customs system, effectiveness of customs control increased, customs tariff policy was improved, combating law-violations in the customs was strengthened. At the same time, role of customs system in the socio-economic development of the country increased, means of customs regulation were brought into line with the international means of regulation, favourable condition was created for facilitation of customs clearance in import and export operations. Basing on the wrong considerations some people form biased and negative opinions against customs authorities.
- However, some businessmen, economists and politicians say in their speech on the media that if any company intended to import 10 products, only 3 of them were imported legally till this year. Other 7 products were imported illegally by paying less. What would you comment on these?
- Yes, some experts regularly sound these opinions on the media. These experts refer to international information recourses, especially customs statistics of interstate trade. Despite we made statements in this regard, they are still forming negative opinions against customs authorities basing on the wrong considerations. I say again that the indicators of Azerbaijan on foreign trade relations are compared to the relevant indicators of other countries at the end of every year and the differences between the indicators are seriously researched. Suspicious approach to the customs clearance without knowing methodology of customs statistics of the foreign trade is non-professionalism.
It would be noted that many factors must be taken in the consideration during customs clearance. These factors include country of origin, sending country, destination of the goods. Especially, the countries at war register the military and confidential goods specifically. According to the international methodological recommendations, it’s more advisable to calculate the volume of import on sending country while conducting comparison on interstate trade relations.
It’s needed to take into account that reasons of differences arisen from comparison of customs statistics of the interstate trade is still actual problem in the international practice. This sphere is studied and explored but no single practical international recommendations have been drawn up yet.
Comparative analysis of the foreign trade links show that such differences exist in many countries. For instance, according to the comparison of data on the official website of the UN, the differences on bilateral trade between the US and China increased to $100 billion. Russia exported goods worth $76 billion to the Netherlands, while the Netherlands exported goods worth $26 billion to Russia. So, according to our experts’ “methodology”, 50% of goods exported from China to the US and 60% of goods exported from Russia to the Netherlands have been exported through informal channels. Is it a right approach?
We don’t note the facts on the Rotterdam effect yet. Azerbaijan is included in the list of oil exporting countries and the Rotterdam Effect appears in customs statistics of Azerbaijan’s foreign trade too. It’s needed to take into consideration that as the European countries have not customs borders, the Rotterdam Effect appeared considerably. The matter is that main part of Azerbaijani oil is exported to Italy-based terminal and noted as an export from Azerbaijan to Italy and then sold to other European countries. Though Germany, France and Czech Republic buy that oil from Italy, it is noted as an export from Azerbaijan because of Azerbaijan is the country of origin.
If one country’s export and import are not similar with the export and import of a country, which have foreign trade relations with that country, the State Customs Committee researches the difference at the end of every year.
- Experts often stress one more issue that customs value of goods are registered lower than real prices of goods during the customs clearance and consequently, the customs duties are artificially reduced. How would you comment on this issue?
- Yes, there are many such discussions, but all of these are not professional. According to article #40.2 of the Customs Code, the persons who clear goods of vehicles through customs are responsible for correctness and completeness of data on the invoice. According to the article #9.0.3 of eth Customs Code and article #11.1 of the Law on Customs Tariff, the customs authority has the right to investigation correctness of any data, document or declaration. However, in case the participants of foreign economic activity are dissatisfied with the decisions of customs authorities on customs valuation, they may appeal to court and law-enforcement agencies and submit facts to them.
- Sometimes it is noted that customs duties in Azerbaijan are higher than in other countries. Is it true? How could you explain if it is not high?
- Several economists, banker and entrepreneurs say that radical reforms conducted in the Customs Committee provided transparency in taking of customs payments imposed on imported goods, however, high taxes and duties caused complaints. These opinions are groundless. Because the VAT (18%) in Azerbaijan is lower than in many countries. The VAT makes 19% in Germany, 20% in Estonia, 21%6 in Belgium, 20% in Austria, 25% in Denmark, 25% in Hungary and etc. On the other hand, 18%-VAT taken from the participants of foreign economic activity are repaid to them during the sale. Foreign trade policy was liberalized during past thirteen years in Azerbaijan, maximum tariff rates were reduced to 15%. Today, according existing normative-legal acts, 0.5%, 1%, 3%, 5%, 10% and 15% duties are imposed on the exported goods depending on their code, which are lower than other countries. For example, Turkey imposes 80-250% on some goods, Russia – 15-80%, European countries – 40-80%. Imposing higher duty rates preserves competitiveness of local products. Therefore, the highest duty rate of 15% in Azerbaijan is not a factor causing price rise or complaints.
- How did the devaluation of national currency and moving to floating currency regime affect the increase of customs payments? Some experts say in spite of decline of economy, incomes of customs system increased 30% in first half of 2016. What can you say about it?
- Reforms conducted in the State Customs Committee, as well as receiving customs payments in accordance with the exchange rate set the Central Bank for that day affect tax and duties on import. So, AZN 1,426,840,000 of customs payments were transferred to the state budget in the current year against budget obligation of AZN 1,156,130,000 determined by the law and the forecast was fulfilled by 123.42%. Therefore, devaluations and moving to floating currency rate provide overfulfilling the forecast.
Generally, dynamical socio-economic development in Azerbaijan on the background of the global financial and economic crisis draws attention of world countries, as well as international organizations. Currently, Azerbaijan holds high positions in several rankings. Reforms conducted in Azerbaijan, social policy and implemented projects and different measures are based on reasonable strategy and direct to sustainable development of the country.
Follow us on Telegram
t.me/apanewsaz
Follow us on Instagram
Follow us on TikTok
Follow us on Facebook
Follow us on X
