Baku:Azerbaijan is set to abolish the full tax exemption in the agricultural sector and replace it with a 90% tax relief mechanism for five years, as reported by APA.

According to Azeri-Press news agency, this change is part of a proposed amendment to the Tax Code aimed at establishing a gradual taxation mechanism and improving tax incentives within the agricultural sector. The current 100% exemption from income and profit taxes, which has been in place for many years, will end, and the new 90% relief will commence on January 1, 2027.

The amendment also specifies that the tax exemption period for dividend income received by founders of legal entities in the agricultural sector will not be extended. Instead, such income will be taxed at a rate of 5%, considering general exemptions, starting next year. However, the exemption from the simplified tax will continue for five years from January 1, 2027, under certain conditions. To qualify for these incentives, producers must be registered on the Ministry of Agriculture’s electronic information system (EKTIS platform) and report their income and profits in their tax returns.