Vugar Bayramov: ‘The use of differential VAT will stimulate the development of priority sectors’

Vugar Bayramov: ‘The use of differential VAT will stimulate the development of priority sectors’

In September, must be prepared a strategic plan for economic reforms Road Map and we hope that some of our proposals will be taken into account, the head of the Center for Economic and Social Development Vugar Bayramov told Turan.

– My organization has prepared a package of proposals on reforms in different sectors of the economy, and we have submitted proposals to the government. We received an invitation from various state agencies to discuss our proposals.
But now we can say that some of our proposals will be considered priorities in the roadmap. For example, government agencies approved our proposal for the preparation of the draft law “On bankruptcy of natural persons.” In this direction the work is already underway. Naturally, in order to prevent the abuse some of the criteria are to be determined in this matter.
In addition, we propose the creation of a special structure on problem loans and asset management. US experience shows that in this way you can do rehabilitation of distressed assets.

Application of benefits on dollar loans and indexation of deposits in manats are also included in our package offers.
In addition, our package includes agriculture, industry, medium and small businesses.

– The government announced reforms in the sphere of taxes. What should we expect?

– I think the recent tax reform will mean a reduction of some tax rates, the abolition of some taxes, simplification of the tax control, and the use of e-audit system.

It should be recognized that the recent changes to the rules are positive. For example, subject to VAT taxation was the sale of goods and the cost of services of production and non-production type. Under the new rules in the retail trade subject to VAT will be trade allowance, which in turn will boost revenues in this area.

At the same time those engaged in retail trade, including supermarkets, will pay much less in taxes.

At the same time, the single VAT rate is canceled and the percentage will vary depending on the sector. It should be noted that the application of differential VAT is important and it will stimulate the development of priority sectors. For example, after applying differential tax with respect to certain goods or sectors there can be applied VAT twice less than now, that is 9%.

Another positive change is the rules on desk audit. Under the new rules the tax authorities may carry out desk audits only within 30 days after submission of the tax return. If deadline desk audits are not carried out, then the tax authorities are not permitted to carry out these checks.

– Analyzing the proposals for changes to the Constitution, it is clear that they will also apply to the economic bloc. For example, it regards the creation of the institute of Vice-Presidents. How do you think, will the powers be shared between the Cabinet of Ministers and the Vice-Presidents?

– Additions and changes proposed in the Act on Referendum will create opportunities for growth and efficiency optimization control system. Institution building of the First Vice-President and Vice-Presidents may create opportunities for institutional improvement of management systems, optimization and clarification of their powers, which in turn will contribute to better coordination of economic reforms and expanding their scope. The result of the new changes can be the formation of the Cabinet of Ministers aimed at deep support for reforms. I believe that this will mean the formation of a new modernized, coordinated by the administrative apparatus for scaling up economic reforms.

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