Administrative control over the activity of municipalities

The amount of land tax is reduced by 10 manat for land owned by the following individuals:

Heroes of the Patriotic War of the Republic of Azerbaijan;

National Heroes of Azerbaijan;

Heroes of the Soviet Union and Socialist Labor;

Persons with war-related disabilities;

Widows (husbands) and children of soldiers who died or died later;

Persons awarded orders and medals for selfless labor on the home front in 1941-1945;

Persons who received the title of war veteran in accordance with the procedure established by legislation;

Persons who suffered from or had radiation sickness and radiation-related diseases as a result of the accident at the Chernobyl NPP, other radiation accidents at civilian or military nuclear facilities, as well as as a result of tests, exercises and other work related to any types of nuclear installations, including nuclear weapons and space technology; parents, widows (husbands) and children of persons who received the status of martyrs.

Land tax for land plots involved in the exploration, evaluation and exploration of mineral deposits (except for oil and gas deposits) based on a geological allocation document is reduced by 75 percent for the calendar year in which the exploration, evaluation and exploration of mineral deposits is initiated based on relevant supporting documents (contract agreement of the person carrying out geological exploration works, geological exploration plan, submitted report on geological exploration) (it does not apply to land plots involved in the exploration, evaluation and exploration of mineral deposits (except for oil and gas deposits) based on a geological allocation document in the same tax year and exploited to extract minerals).

Taking into account Articles 199.11 and 199.14 of the Tax Code, property tax on real estate used as a means of accommodation in hotels and sanatoriums (except for the period of temporary suspension of entrepreneurial activity) in other cities and regions of the republic, including the Nakhchivan Autonomous Republic, with the exception of Baku, Sumgayit, Khirdalan cities and Absheron region, shall be reduced by 75 percent for a period of 3 years from January 1, 2024.

The amount of property tax payable by individuals who are exempt from land tax, as well as pensioners and conscripts and their family members for buildings during the period of conscripted military service, shall be reduced by 30 manat.

In order for a municipality to dispose of its lands, its ownership rights to those lands must first be registered with the state. The municipality sells adjacent land to persons permanently residing in the territory of the municipality and registered for at least five years, directly by decision of the municipal meeting, after receiving the opinions of the relevant state bodies (architectural services of local executive bodies and local bodies of the State Service for Property Issues under the Ministry of Economy). The municipal decision indicates the sale price of the land and the period for payment of the remaining part of the land by the buyer (not more than 60 days). If the value of the land is paid by the buyer within that period, a notarial purchase and sale agreement is concluded between the municipality and the buyer. A person who has acquired an adjacent land plot in this manner cannot alienate it for five years. Other persons may purchase the adjacent land plot if they win by participating in an auction or competition.

Land tax for individuals:

Agricultural lands used for their intended purpose or which cannot be used for their intended purpose due to irrigation, land reclamation and other agrotechnical reasons;

Industrial, construction, transport, communications, commercial and household service and other special-purpose lands; Lands of housing funds, backyards and gardens of citizens;

Property tax for individuals on buildings, water and air transport vehicles;

Profit tax for enterprises and organizations owned by the municipality.

Since municipalities are not economic bodies, they cannot directly engage in entrepreneurship. However, the legislation gives municipalities the right to establish their own legal entities (enterprises). Municipalities can establish legal entities (enterprises) that engage in all forms of entrepreneurship (production, services, etc.), with the exception of activities prohibited by legislation.

By the Law "On the Establishment of New Municipalities through the Merger of Municipalities in the Republic of Azerbaijan" dated October 18, 2024, 480 new municipalities were established as a result of the merger of 1,400 municipalities in 63 cities and regions. The total number of municipalities in the country was reduced from 1,606 to 685 municipalities.

Buildings privately owned by individuals and located on the territory of the Republic of Azerbaijan, water and air transport vehicles owned by individuals, regardless of their location and use, are subject to property tax. The tax paid on these objects is property tax. Property tax on individuals is paid to the municipal budget in a non-cash manner. Property tax on buildings owned by individuals is calculated by the municipality of the territory where it is located for each square meter of the building's area (in relation to residential areas - their part exceeding 30 sq.m.), at tax rates and with coefficients applied to buildings located in Baku (when the building is located in Baku, coefficients not lower than 0.7 and not higher than 1.5 determined by the Cabinet of Ministers of the Republic of Azerbaijan are applied to these rates). If an individual has several residential areas, 30 sq.m. of non-taxable area is deducted from each of the residential areas. Property tax on buildings with several owners is calculated for each owner of that building in accordance with his share in the building's area. Property tax rates for individuals:

Example of tax calculation for an individual house (or apartment):

Total area 60 square meters, 30 square meters are not included in the tax calculation.

1. Address – Baku city. Inshaatchilar avenue (zone 3, coefficient 1.3) Tax per 1 square meter in Baku – 0.40 AZN; (60 -30) х 0,40 х1,3 = 15,6 manat

2. Address - Guba district, Dallakli village. Tax per 1 sq.m. – 0.1 AZN (60 -30) х 0,1 = 3 manat

Example of calculation of taxes on non-residential premises

Total area of ​​the object is 70 sq.m., address – Baku city. Istiglaliyyat street (zone 1, coefficient 1,5) Tax per 1 sq.m. in Baku – 0.40 AZN; 70 х 0,40 х1,5 = 42 manat

Property tax for water and air transport vehicles is calculated as of January 1 of each year based on the information provided by the organizations that carry out their registration. In the absence of such registration, the owner of such property shall submit documents reflecting the necessary information (year of manufacture, purchase price and technical characteristics) about the water and air transport vehicles owned by him to the tax service body of the relevant municipality by January 1 of each year. Tax on water and air transport vehicles owned by several individuals shall be levied on the person who registered the vehicle in his name. - 0.02 manat per 1 cubic centimeter of the engine of the water and air transport vehicle; - 0.02 manat per 1 cubic centimeter of the engine of the air transport vehicle; - for water and air transport vehicles without an engine - 1 percent of their market price.