Tax system of Azerbaijan and forms of

taxation
The taxes levied in the Republic of Azerbaijan
pursuant to the Tax Code shall be as follows:

State taxes

Taxes of autonomy republic

Local (municipal) taxes

 1. Income tax of physical persons
State 2. Profit tax of legal entities*
taxes 3. Value added tax
4. Excises
5. Property tax of legal entities
6. Land tax of legal entities
7. Road tax
8. Mining tax
9. Simplified tax

* - except for enterprises and organizations owned by municipalities

 Taxes of the 1. Income tax of physical persons
autonomous
2. Profit tax of legal entities**
republic*
3. Value added tax
4. Excises
5. Property tax of legal entities
6. Land tax of legal entities
7. Road tax
8. Mining tax
9. Simplified tax

* - The taxes of the Autonomous Republic are those taxes that are stipulated by the laws of the
Nakhchivan Autonomous Republic in accordance with the Tax Code and obligatory for payment in the
Nakhchivan Autonomous Republic (Art. 4.3, TC).

** - except for enterprises and organizations owned by municipalities

 Local land tax of physical persons
(municipal)
taxes*
property tax of physical persons

mining tax on construction materials of local

importance

profit tax of enterprises and organizations that

are owned by municipalities

* - The Local (municipal) taxes are those taxes stipulated by the Tax Code and other applicable
legislation, applied by the decisions of municipalities and obligatory for payment within the territory
of municipalities.
 Tax regimes in Azerbaijan

1. General tax regime

2. Special Tax regime
3. Temporary tax regime

In accordance with the Tax Code special tax regime and temporary tax regime can be
applied on the territory of the Republic of Azerbaijan.
The special tax regime stipulates the special procedure for tax calculation and payment
for the specified period of time.
Temporary tax regime stipulates the temporary procedure of calculation and payment
of taxes for a certain period of time in relation to all or some business entities due to
significant changes in economic conditions (for example natural disasters, epidemics,
epizootics, major environmental and other disasters, as well as events in the global
economic environment).
Companies with special tax regimes
operating in Azerbaijan

Enterprises with special tax regime:

Taxpayers operating under the agreements or laws on production sharing,
approved by the legislation;
Taxpayers operating under the main export pipeline and other such agreements
and laws, including the law of oil and gas, oil and gas activities for export and
special economic zones.
Taxpayers are governed by special rules of calculation and payment of taxes in
a period in taxation and tax control.
Diplomatic and similar representations of foreign countries on the territory of
the Republic of Azerbaijan, consular and other official representations
 Directly from
the source

Forms of
taxation

by notice
by declaration
 Forms of taxation (basic tax types)
directly from the source - taxes on what you buy
tax collection before obtaining income or profit
VAT, Excises.

by declaration - taxes on what you earn

tax collection after obtaining income or profit
Income tax of physical persons, Profit tax of legal entities.

by notice - taxes on what you own

payment of the tax by taxpayer on the basis of payment notice, issued for the
sum, calculated by taxation authority or municipality on the basis of cost of
the taxation object and area.
land tax of physical persons, property tax of physical persons.
Tax calculation and payment currency

On the territory of the Republic of Azerbaijan taxes are

calculated and paid in the currency of the Republic of
Azerbaijan - manats.
 The tax shall be considered as established
only if taxpayers and elements of taxation are determined

Taxpayers...

Elements of taxation...
Elements of taxation
subject of taxation;
basis for taxation;
tax period;
tax rate;
tax calculation procedure;
tax payment procedure and timing.
The Tax Code of the Republic of Azerbaijan (Approved
by the Law No.905-IG of the Azerbaijan Republic from 11 July, 2000):

• The number of taxes was reduced from 13 to 9;

• The corporate income tax rate was reduced from 30%
to 27% (now the rate is 20%);
• The VAT rate was reduced from 20% to 18%;
• The top (higher) rate of personal income tax was
decreased from 40% to 35% (now the top rate is 25%).
 The corporate income tax rates

Before the Tax Code After the Tax Code

Years Tax rates (%) Years Tax rates (%)

1992-1996 35 2001-2002 27
1997-1998 32 2003 25
1999 30 2004-2005 24
2000 27 2006-2009 22
    2010-2022 20

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The personal income tax rate from
individual entrepreneurs
Before the Tax Code After the Tax Code

Verginin dərəcəsi Verginin dərəcəsi

İllər İllər
(%-lə) (%-lə)

1992-1995 12-55 2001-2003 12-35

1996-1999 12-40 2004-2009 14-35

2000 12-35 2010-2022 20

15
Personal income tax rates from
salaries and wages
Before the Tax Code After the Tax Code

Years Tax rates (%) Years Tax rates (%)

1992-1995 12-55 2001-2003 12-35

1996-1999 12-40 2004-2009 14-35
2000 12-35 2010-2012 14-30
    2013-2022 14-25

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Thanks for your attention!