16:24 - 25.11.2025

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November 25, Fineko/abc.az. The abolition of tax benefits starting from next year and the introduction of new taxes were met with mixed reactions in society. Many assume that this will affect prices, and some assume that the "shadow economy" will expand. Thus, experts believe that withholding taxes from salaries of employees in the private sector will lead to the fact that entrepreneurs will underestimate wages. We have studied the position of expert economist Rashad Hasanov on this issue.

The expert told ABC.AZ that first of all, it is necessary to expand and effectively apply measures to whitewash the economy.

Hasanov believes that there is currently a serious link between the increasing level of formalities in the Azerbaijani economy and non-cash payments. A similar form exists in international practice. In many cases, informal business activities and informal economic activities are identified with the shadow economy. In other words, money turnover is considered the main source of the shadow economy here, and therefore I think that, first of all, measures in this direction should be expanded. After the pandemic, great opportunities have emerged. Infrastructure is being created, and conservative views in this direction are relatively weakening. At that, cashless payment habits are developing. With more advanced and flexible tools, it will be effective to facilitate non-cash turnover, covering broader areas of economic activity," Hasanov emphasized.

At the same time, the expert, who considers optimization of the tax burden to be one of the most important points, says that the tax burden of commercial income in Azerbaijan ranges from 40%: "This is quite a large indicator compared, for example, with resource countries. After making a comparison, we will see that, for example, in Qatar, Kuwait, Bahrain, the UAE, Kazakhstan, and even in the UK, where capitalism is practiced at a significant level, this figure is about 30%. In the other countries that I have listed, the approach for the relevant indicators is lower. In Qatar, Kuwait, and Bahrain, this figure ranges from 14-17%, and in the UAE it is about 18%. That is, taking into account the overall implementation of measures in this direction and after the increase in the level of economic formalities, it is natural that the strategy that is being followed today is correct in the sense that certain steps can be taken through a phased transition."

 

By Elmir Murad