VAT Not Canceled for Supermarkets

Supermarkets are not exempt from value added tax (VAT). As the Minister of Taxes Fazil Mammadov reported, the categorical refusal of the request of the leadership of the largest retail chains is due to the fact that almost all (98%) of agricultural products, including local ones, are sold in the markets, where even a simplified tax for entrepreneurs is not charged.

Recall, on April 19 the Minister of Economy Shahin Mustafayev received a deputation of several supermarket chains: Araz, Neptune, Bolmart, Bizim Market, Fresco, Sebet, and Macromart. They complained about not being able to employ their staff after the two-time devaluation of the manat and asked to provide tax incentives for preservation of profitability while maintaining the price of the "social" range of food products, such as milk, flour, eggs, rice, meat, fish, butter, fruits, vegetables and baby nutrition.

The experts recommended they should reduce their non-target costs and get rid of too many wholesalers, which would save their finance and increase the profitability. Recall that after the December devaluation the retail prices in stores increased by an average of 40%, which concerned not only imports but also local products, including fruits, vegetables, and even products of JSC Azersun Holding, whose products are up to 60% of the assortment of food, especially packaged goods, and which owns the largest chain of stores. --17D-