This tax is intended to ease the tax burden for small businesses and is in lieu of general profit tax. The simplified tax is charged at the following rates on taxpayers’ gross revenue:
* 4% for taxpayers operating in Baku
* 2% for taxpayers operating in other regions of Azerbaijan
In order to quality for this tax, the total revenue of the legal entity should not exceed 120,000 Azerbaijan manats (approximately 154,000 USD) for the previous 12-month period and not registered for VAT. The payers of simplified tax are also exempt from VAT, profits tax and property tax. The quarter is the reporting period for the simplified tax regime.