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Control over objects in the markets will be strengthened
Control over objects in the markets will be strengthened
According to the amendments to the Tax Code that came into force on January 1, 2025, some additional duties have been added to the responsibilities of taxpayers. Expert Anar Bayramov comments on the update.
The following three additions have been made to the responsibilities of taxpayers:
- Except for agricultural product markets and agricultural cooperative markets, when property is leased by the owners of markets (or their managers when the markets are transferred for management), after the business entity (or object) leasing the property is registered with the tax authority, the market owners (or managers) must ensure that the business entity (or object) is able to operate in those business premises (Article 16.1.11-15).
- Except for agricultural product markets and agricultural cooperative markets, in markets, when immovable property is used for entrepreneurial purposes by the property owners (or their managers when the markets are transferred for management), or by the lessees when the property is leased, the tax registration of the business entity (or object) should be recorded at the entrance of the premises (showing the taxpayer's name and tax identification number) (Article 16.1.11-16).
- Except for agricultural product markets and agricultural cooperative markets, if the lease agreement for the market is terminated and the taxpayer is not actually operating in the premises, or if the taxpayer continues their activity, the market owners (or their managers when the markets are transferred for management) must submit to the tax authority, in electronic format, information about these taxpayers within 20 days after the end of each quarter (Article 16.1.11-17).
Before highlighting the important points regarding the additions to taxpayers' responsibilities, let's emphasize the purpose of these amendments. In order for a taxpayer to install a cash register and POS terminal, the first step is to register the business premises with the tax authority. Unfortunately, some taxpayers are not interested in registering their premises with the tax authority. Therefore, the recent changes to the Tax Code place an obligation on market owners (or managers) to ensure the registration of the taxpayer's premises with the tax authority. It is worth noting that similar practices exist in the Russian Federation and Georgia.
Regarding the important points, firstly, all three added provisions in the Tax Code will come into effect after 9 months, i.e., on October 1, 2025. This is specified in Article 3 of the Law on amendments to the Tax Code. Also, in the transitional provision in Article 2 of the Law, it is stated that, except for agricultural product markets and agricultural cooperative markets, the owners of markets (or their managers when the markets are transferred for management) must ensure the registration of business entities (or objects) with the tax authority within 6 months after the Law comes into force.
Example: The managers of a shopping center must ensure that the business entity selling commercial goods in the center receives a tax registration code by March 1, 2026. This is because the owners of markets (or managers when markets are transferred for management) must ensure the registration of business entities (or objects) with the tax authority within 6 months after the Law comes into force.
Secondly, when the term "market" is mentioned in this article, it includes not only shopping centers but also "malls."
Thirdly, the recent changes to the Tax Code impose the following three new duties on market owners (or managers when markets are transferred for management):
- They must monitor whether the lessee registers the leased property with the tax authority. If the lessee does not register the property with the tax authority, the lessor must not allow the lessee to operate;
- They must ensure that the lessee displays the certificate of tax registration at the entrance to the property;
- Market owners (or their managers when markets are transferred for management) must submit quarterly reports to the tax authority. These reports should include information about taxpayers who have terminated their lease agreements and are no longer operating in the property, as well as those who continue to operate.
It should be noted that the section of the Tax Code related to financial sanctions includes control measures for the situations mentioned above.
According to the amendments to the Tax Code that came into force on January 1, 2025, some additional duties have been added to the responsibilities of taxpayers. Expert Anar Bayramov comments on the update.
The following three additions have been made to the responsibilities of taxpayers:
- Except for agricultural product markets and agricultural cooperative markets, when property is leased by the owners of markets (or their managers when the markets are transferred for management), after the business entity (or object) leasing the property is registered with the tax authority, the market owners (or managers) must ensure that the business entity (or object) is able to operate in those business premises (Article 16.1.11-15).
- Except for agricultural product markets and agricultural cooperative markets, in markets, when immovable property is used for entrepreneurial purposes by the property owners (or their managers when the markets are transferred for management), or by the lessees when the property is leased, the tax registration of the business entity (or object) should be recorded at the entrance of the premises (showing the taxpayer's name and tax identification number) (Article 16.1.11-16).
- Except for agricultural product markets and agricultural cooperative markets, if the lease agreement for the market is terminated and the taxpayer is not actually operating in the premises, or if the taxpayer continues their activity, the market owners (or their managers when the markets are transferred for management) must submit to the tax authority, in electronic format, information about these taxpayers within 20 days after the end of each quarter (Article 16.1.11-17).
Before highlighting the important points regarding the additions to taxpayers' responsibilities, let's emphasize the purpose of these amendments. In order for a taxpayer to install a cash register and POS terminal, the first step is to register the business premises with the tax authority. Unfortunately, some taxpayers are not interested in registering their premises with the tax authority. Therefore, the recent changes to the Tax Code place an obligation on market owners (or managers) to ensure the registration of the taxpayer's premises with the tax authority. It is worth noting that similar practices exist in the Russian Federation and Georgia.
Regarding the important points, firstly, all three added provisions in the Tax Code will come into effect after 9 months, i.e., on October 1, 2025. This is specified in Article 3 of the Law on amendments to the Tax Code. Also, in the transitional provision in Article 2 of the Law, it is stated that, except for agricultural product markets and agricultural cooperative markets, the owners of markets (or their managers when the markets are transferred for management) must ensure the registration of business entities (or objects) with the tax authority within 6 months after the Law comes into force.
Example: The managers of a shopping center must ensure that the business entity selling commercial goods in the center receives a tax registration code by March 1, 2026. This is because the owners of markets (or managers when markets are transferred for management) must ensure the registration of business entities (or objects) with the tax authority within 6 months after the Law comes into force.
Secondly, when the term "market" is mentioned in this article, it includes not only shopping centers but also "malls."
Thirdly, the recent changes to the Tax Code impose the following three new duties on market owners (or managers when markets are transferred for management):
- They must monitor whether the lessee registers the leased property with the tax authority. If the lessee does not register the property with the tax authority, the lessor must not allow the lessee to operate;
- They must ensure that the lessee displays the certificate of tax registration at the entrance to the property;
- Market owners (or their managers when markets are transferred for management) must submit quarterly reports to the tax authority. These reports should include information about taxpayers who have terminated their lease agreements and are no longer operating in the property, as well as those who continue to operate.
It should be noted that the section of the Tax Code related to financial sanctions includes control measures for the situations mentioned above.