11:54 - 6.03.2023

---

March 6, Fineko/abc.az. A 1% tax has been levied on deposits in banks, which is ambiguously perceived by the public in Azerbaijan.

So, the majority believes that these interests should not be deducted from citizen’s income from the deposit.

In this regard, MP Vugar Bayramov informed ABC.Az that according to the Tax Code, this type of tax is the taxation of savings income in banks.

The MP explained that interest is accrued from deposits placed by the population:

"The savings parties receive income from protection of dividends of deposits. In this regard, according to the Code, the tax is deducted from income of deposit holders. For example, if a citizen has a deposit in a bank in the amount of 6,000 manats and this amount brings income in the amount of 9% per annum, that is, income in the amount of 540 manats is accrued on this amount, then 10% of this money is taxed. And as a result, a citizen pays a tax of 54 manats from a deposit of 6,000 manats. And his income for placing a deposit is 486 manats."

Bayramov believes that banks should take the initiative in the matter under consideration: "Due to high tax rates, banks, increasing deposit rates, undertake these costs. In fact, banks can charge a significant portion of the 10 percent tax applied to their income, increasing the deposit interest by 1 percent. Therefore, I think it would be more appropriate for the compensation of this tax to be made by banks with an increase in deposit interests."