The Milli Majlis (National Assembly) of the Republic of Azerbaijan adopted amendments to the Tax Code in the final reading during today's plenary session.
According to the Operative Information Center-OMM, the new legislation introduces significant financial incentives for taxpayers in the non-oil and gas sector, specifically targeting the private sector.
Under the approved changes, effective from January 1, 2027, entrepreneurs will be permitted for a four-year period to utilize free funds available in their VAT deposit accounts to cover mandatory state social insurance contributions (DSMF payments) for their employees. This mechanism will be regulated in accordance with the rules and conditions established by the relevant executive authority.
The primary objective of this legislative adjustment is to enhance the liquidity of private sector businesses and alleviate their overall financial burden. By allowing the use of VAT deposit funds for social insurance, the government aims to improve cash flow management for entrepreneurs, thereby fostering a more favorable business environment in Azerbaijan.
The law is scheduled to enter into force on January 1, 2027.
