Azerbaijan Tax Authorities Detail Positive Progress in 2011

January 12, 2012 Taxation in Azerbaijan

[mb] QuartersBAKU – The process of European integration has spurred Azerbaijan to change the practices of tax authorities and improve tax compliance measures in the country.

In his recently published interview, the Minister of Taxation of Azerbaijan Fazil Mammadov noted that active European integration requires a substantial increase to the effectiveness of national tax authorities, which may lead to an improvement of the national business environment and may raise the amount of foreign investment into Azerbaijan.

According to the Minister, some of the key achievements made by the tax authorities of Azerbaijan in recent years are the development and adaptation of a national Tax Code, a modernization of tax management systems in the country, and implementation of the national Automated Tax Information System (AVIS).

Throughout 2011 national tax authorities launched 524 criminal investigations into suspected cases of the violations of tax regulations. So far, 50 of the cases have been passed to the courts, and 208 cases were closed after the offenders paid all avoided taxes and all applicable penalties, which netted tax authorities an approximately AZN 41.8 million (approx. USD 53.1 million) in additional revenues for the government budget.

In total throughout 2011, tax authorities detected over 31 thousand instances where tax regulations were violated by taxpayers. Azerbaijan tax authorities noted that the most common types of offenses were acceptance of payment in foreign currencies, and violations of cash transactions. The total amount of penalties and fines for the recorded offenses reached over AZN 15.5 million (approx. USD 19.7 million).

Photo by Merrick Brown