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How is the duration of a tax authority’s inspection at a business entity determined?
How is the duration of a tax authority’s inspection at a business entity determined?
According to Article 18.1 of the Law of the Republic of Azerbaijan “On Regulation of Inspections Conducted in the Field of Entrepreneurship and Protection of Entrepreneurs’ Interests”, the duration of a scheduled (regular) inspection must not exceed ten working days for large business entities and five working days for medium, small, and micro enterprises. The duration of an unscheduled (extraordinary) inspection must not exceed five working days for large business entities and three working days for medium, small, and micro enterprises. The criteria for classifying businesses as large, medium, small, or micro are determined in accordance with the Law “On Entrepreneurial Activity”. In this case, if the decision issued by the tax authority for conducting an extraordinary inspection states that the inspection period is 30 days, would this be considered a violation of the law?
The State Tax Service under the Ministry of Economy stated that, according to Article 2.2 of the Law of the Republic of Azerbaijan “On Regulation of Inspections Conducted in the Field of Entrepreneurship and Protection of Entrepreneurs’ Interests”, this law does not apply to tax inspections.
It was also noted that in cases where contradictions arise between tax legislation and other sectoral legislation (except for the cases provided for in Article 2.7 of the Tax Code) regarding taxation and tax control matters, the provisions of tax legislation shall apply.
In response to the inquiry, it was stated that according to Article 38.2 of the Tax Code, the duration of a field tax audit must not exceed 30 working days; however, in exceptional cases, this period may be extended up to 90 working days by a higher tax authority.
Basis: Article 38.2 of the Tax Code and Article 2.2 of the Law “On Regulation of Inspections Conducted in the Field of Entrepreneurship and Protection of Entrepreneurs’ Interests”.
According to Article 18.1 of the Law of the Republic of Azerbaijan “On Regulation of Inspections Conducted in the Field of Entrepreneurship and Protection of Entrepreneurs’ Interests”, the duration of a scheduled (regular) inspection must not exceed ten working days for large business entities and five working days for medium, small, and micro enterprises. The duration of an unscheduled (extraordinary) inspection must not exceed five working days for large business entities and three working days for medium, small, and micro enterprises. The criteria for classifying businesses as large, medium, small, or micro are determined in accordance with the Law “On Entrepreneurial Activity”. In this case, if the decision issued by the tax authority for conducting an extraordinary inspection states that the inspection period is 30 days, would this be considered a violation of the law?
The State Tax Service under the Ministry of Economy stated that, according to Article 2.2 of the Law of the Republic of Azerbaijan “On Regulation of Inspections Conducted in the Field of Entrepreneurship and Protection of Entrepreneurs’ Interests”, this law does not apply to tax inspections.
It was also noted that in cases where contradictions arise between tax legislation and other sectoral legislation (except for the cases provided for in Article 2.7 of the Tax Code) regarding taxation and tax control matters, the provisions of tax legislation shall apply.
In response to the inquiry, it was stated that according to Article 38.2 of the Tax Code, the duration of a field tax audit must not exceed 30 working days; however, in exceptional cases, this period may be extended up to 90 working days by a higher tax authority.
Basis: Article 38.2 of the Tax Code and Article 2.2 of the Law “On Regulation of Inspections Conducted in the Field of Entrepreneurship and Protection of Entrepreneurs’ Interests”.