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Azerbaijan to soften system of customs duties tariffication

22 November 2017 [11:33] - TODAY.AZ

By Azernews


By Sara Israfilbayova

Azerbaijan will switch to a new system of customs duties in 2018.

In order to improve effectiveness of foreign economic activity by modernizing the mechanism of setting customs tariffs, strengthening state support for domestic production and non-oil exports, protecting the domestic market, as well as switching to a system with fewer customs duties, was approved a new document- “Commodity Nomenclature of Foreign Economic Activity, Rates of Import and Export Customs Duties”.

Earlier, Aydin Aliyev, head of Azerbaijan’s State Customs Committee, told Trend that the committee submitted proposals to the Cabinet of Ministers regarding transition to a three-level customs tariff system, which envisages changing customs duties on raw materials and goods imported to the country.

Proposals for the transition from a multi-level to a three-level differentiated tariff system provide for the preservation of customs duty rates at 0, 5 and 15 percent in Azerbaijan.

Today, the customs rates of 0, 0.5, 1, 3, 5, 10 and 15 percent are applied in the country. Previously, it was suggested to keep four rates - 0, 5, 10 and 15 percent, but later a 10-percent rate was excluded from the proposed package.

It is proposed to exempt the majority of the goods (raw materials and equipment) from customs duties. This applies to those types of commodity groups (in particular, 84 and 85 groups), which already, under the order of the Cabinet, are subject to VAT at zero rate when importing. The semi-finished products will be subject to a customs rate of 5 percent.

“It is proposed to raise the custom duties for the import of finished products to Azerbaijan to 15 percent,” Aydin Aliyev noted. “On the one hand, this will stimulate and support domestic production, and on the other hand, it will prevent the outflow of foreign currency.”

Earlier, the government discussed changes in excise tax rates for tobacco and alcohol products, relying on the fact that excise tax rate in Azerbaijan is quite low.

“When raising excise tax rates, we carefully analyze the situation. Tobacco and alcohol products are not essential goods, and in addition, the increase in excise tax rates will not be too sharp,” he said.

Changing excise tax rates for imported products is considered within the draft amendments to the Tax Code of Azerbaijan for 2018. It was expected that the change in excise tax rates will lead to the increase in prices for cigarettes with a share of 1.92 percent in country’s total import.

At the same time, such a decision may result in further development of local production of tobacco and alcohol. At present, the excise tax rate on malt beer imported to Azerbaijan is 1 manat per liter; wines from fresh grapes, including fortified wines; grape must – 2 manats per liter; sparkling wines - 2.5 manats per liter; whiskey, vodka, liqueur, rum and other alcoholic beverages - 6 manats per liter.

The customs authorities transferred over 1.95 billion manats ($1.15 billion) to the state budget in January-September 2017, which is 18 percent higher than the figure of the same period of last year.

The forecast for customs revenues to the state budget of Azerbaijan for 2017 is 2.205 billion manats ($1.3 billion).

URL: http://www.today.az/news/business/167051.html

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