Why has the state budget been re-examined in Azerbaijan and what has changed?

Instead of adjourning for summer vacations, the parliament of Azerbaijan passed a bill at the last parliamentary spring session making several changes to the state budget. These changes were approved by President Ilham Aliyev in the last days of June.

The state budget is set out for the year, but half a year had already passed when MPs decided to make these changes.

What changes were made, and were they necessary? JAMnews looked into the question.

The price of oil has risen, and the treasury has come into more money. Azerbaijani MPs wanted to make good use of the new-found funds, and redirect oil money into different sectors.

Income

The treasury will increase by AZN 1.9 billion [USD 1.1 million], mostly thanks to a rise in oil prices, which will contribute 20.3% more funds to the state treasury than formerly expected.

Tax reliefs call for 6.7 per cent less taxes to be collected by the Ministry of Taxes than had originally been estimated. However, it is predicted that customs services will collect 38 per cent more in fees than originally expected.

What changes are in store for ordinary citizens?

The state fee for the sale of property will increase by some 20-25 per cent: residents of various cities will pay between USD 74 and 147.

The fee for buying an automobile straight from another owner (private sale) used to be USD 6. The fee will now depend on the vehicle’s engine capacity and may vary between USD 60 and 882.

If a citisen of Azerbaijan buys a telephone abroad, they will have to pay between USD 18 and 88 to register the phone, which is significantly more than the USD 3 paid previously. If the phone has two sim slots, then the amount is doubled.

Car owners are the unluckiest of all. The fee for obtaining a driver’s license will now be USD 15 instead of 10. For license plates, the cost will be USD 20 instead of 13. In order to buy vanity plates, the price will be between USD 300 and 1500, and will be auctioned.

How will the extra AZN 2 billion be spent and on what?

‘Economic activity’ stands to gain most from the new funds. Expenditure in this field is divided into several different sectors, the largest of which is the purchase of intangible assets.

As for who the beneficiaries of this money will be, the largest sums will be transferred to state companies, including SOCAR (USD 566.5 million), Azerbaijani Railways (AZN 59 million) and Azerenerji, which is responsible for Azerbaijan’s blackout in July which was caused by a thermal power station problem (USD 48 million).

The state tourism agency will receive USD 12 million as part of an increase in expenditures under the item ‘culture, art and fitness’. Agriculture will receive an additional USD 58 million, which is 15 per cent more than previously planned.

The rest of the expenditures saw little growth, receiving two to seven percent more in funding, including for defence, social security, education, culture and art, and others.