Simplified Tax System (Sadələşdirilmiş vergi sistemi) in Azerbaijan
The Simplified Tax is an alternative tax regime regulated under Chapter VIII (Articles 218–221) of the Tax Code of the Republic of Azerbaijan:
- Eligibility Turnover Cap: Available to small enterprises and sole proprietors whose gross taxable revenue does not exceed 200,000 AZN in any consecutive 12-month period.
- Statutory Rates:
- Commercial Trading & General Services: Flat 2.0% on total gross revenue.
- Public Catering (Restaurants & Cafes): 8.0% in the City of Baku; 4.0% in other administrative regions of Azerbaijan.
- Passenger & Cargo Road Transport: Fixed monthly tax per vehicle seat/tonnage multiplied by regional coefficients.
- Replaces CIT & VAT: Registered simplified taxpayers are completely exempt from Corporate Income Tax (20%) and Value Added Tax (18%).
- Quarterly Reporting: Declarations and tax remittances are submitted by the 20th of the month following each calendar quarter.
Statutory Regulatory Framework: Compliant with the Tax Code of the Republic of Azerbaijan, Labor Code of the Republic of Azerbaijan, Law on Social Insurance (SSPF / DSMF), and regulatory decrees issued by the State Tax Service, Tariff (Price) Council, and State Customs Committee.