en
Effective date of the decision on the taxpayer being a risky taxpayer
Effective date of the decision on the taxpayer being a risky taxpayer
As we reported, the Cabinet of Ministers adopted a Resolution "On Amendments to the Resolution No. 265 of the Cabinet of Ministers of the Republic of Azerbaijan dated July 28, 2020 on Approval of the "Criteria of Risky Taxpayers, Including Risky Transactions".
According to Siraj Piriyev, there is a contradiction between the clause of the Cabinet of Ministers' Rules on risky taxpayers and the article of the Law "On Administrative Proceedings": "With the new amendment, the following last sentence has been added to Clause 4.2 of the Rules reflecting the risk criteria of taxpayers: "The decision on the taxpayer being a risky taxpayer shall enter into force from the date of the transaction that served as the basis for the adoption of that decision".
The reason for the proposed amendment in this form is undoubtedly the existing judicial practice. The chosen way out is unsuccessful. Thus, the decision to consider a risky taxpayer is adopted in each case after the transaction. Simply because the tax authorities often cannot justify that the risky decision was adopted in relation to the transaction between those persons, the courts consider that the person could not have been interested in refraining from conducting a transaction with him since the counterparty was not a risky taxpayer at the time of the transaction. The current amendment does not affect this approach in any way. Although the risky decision is valid from the previous date, what is important is when the person became aware of it. According to Article 64.1 of the Law on Administrative Proceedings, an administrative act enters into legal force from the moment the person to whom it is addressed or the person whose interests it affects is informed about it, or from the moment it becomes known to those persons. As can be seen, that paragraph of the Rules also contradicts the Law. According to Article 2.6 of the Constitutional Law “On Normative Legal Acts”, if a decree or other normative legal act contradicts the law, the law shall be applied. In this regard, despite the purposeful addition of that paragraph to the Rules, it will have no significance."
As we reported, the Cabinet of Ministers adopted a Resolution "On Amendments to the Resolution No. 265 of the Cabinet of Ministers of the Republic of Azerbaijan dated July 28, 2020 on Approval of the "Criteria of Risky Taxpayers, Including Risky Transactions".
According to Siraj Piriyev, there is a contradiction between the clause of the Cabinet of Ministers' Rules on risky taxpayers and the article of the Law "On Administrative Proceedings": "With the new amendment, the following last sentence has been added to Clause 4.2 of the Rules reflecting the risk criteria of taxpayers: "The decision on the taxpayer being a risky taxpayer shall enter into force from the date of the transaction that served as the basis for the adoption of that decision".
The reason for the proposed amendment in this form is undoubtedly the existing judicial practice. The chosen way out is unsuccessful. Thus, the decision to consider a risky taxpayer is adopted in each case after the transaction. Simply because the tax authorities often cannot justify that the risky decision was adopted in relation to the transaction between those persons, the courts consider that the person could not have been interested in refraining from conducting a transaction with him since the counterparty was not a risky taxpayer at the time of the transaction. The current amendment does not affect this approach in any way. Although the risky decision is valid from the previous date, what is important is when the person became aware of it. According to Article 64.1 of the Law on Administrative Proceedings, an administrative act enters into legal force from the moment the person to whom it is addressed or the person whose interests it affects is informed about it, or from the moment it becomes known to those persons. As can be seen, that paragraph of the Rules also contradicts the Law. According to Article 2.6 of the Constitutional Law “On Normative Legal Acts”, if a decree or other normative legal act contradicts the law, the law shall be applied. In this regard, despite the purposeful addition of that paragraph to the Rules, it will have no significance."