Azerbaijan introduces new incentive for private sector outside the oil and gas industry

Private sector entities operating outside the oil and gas sector will be allowed to transfer funds from their VAT deposit accounts to the State Social Protection Fund.

The provision is reflected in amendments to the Tax Code discussed at today's session of the Milli Majlis.

According to the draft, the possibility of transferring funds from VAT deposit accounts to the State Social Protection Fund will take effect on January 1, 2027, for a period of four years. The relevant conditions and procedures will be determined by the body (institution) designated by the relevant executive authority.

The draft law is intended to expand taxpayers' ability to use funds held in their VAT deposit accounts, create additional financial resources for fulfilling social obligations, and ultimately support taxpayers operating in the non-oil and gas private sector.

The draft law was put to a vote and adopted in the third reading.