VAT abolition proposed in health sector, but Tax Ministry DOES NOT AGREE


October 10, Fineko/abc.az. The medical community, basing on the experience of other countries for the development of healthcare sector, draws attention to the fact that services in this sector are exempt from VAT in foreign countries. But a one-sided comparison does not give a fair result. Income and profit tax rate is very high in a range of countries where medical services are allegedly exempt from VAT.

ABC.AZ reports that the statement was made by the Ministry of Taxes, which added that while the average monthly salary in Azerbaijan is about 500-600 manats, those who earn up to 8,000 manats in the non-oil sector are usually exempt from income tax.

This benefit applies to benefit a greater number of employees.

"Private clinics belong to the non-oil sector, and persons receiving salaries of up to 8,000 manats in this sector are free from paying income tax. Medical facilities are exempt from property tax. Moreover, the exemption of bank loans from VAT in the financial sector, as in all sectors, has created favorable conditions for obtaining loans to entrepreneurs working in the field of medicine.

There are quite a lot of benefits. It is no secret that specialists with a sufficient number of patients in the field of medicine are working at several clinics. Getting more income should be directed for more responsible execution of payments to the budget, and not for tax evasion. Transparent declaration of income in the application of all those benefits is a requirement of the time. The state can ensure the stability of benefits in terms of building a transparent system of relations and ensuring financial discipline."

By Elmir Murad