Azerbaijan is set to allow 250% tax deduction for innovation and research & development (R&D) expenses. This change is included in proposed amendments to the Tax Code.
Under the new rule, taxpayers can deduct 250% of actual costs incurred for innovation products from their taxable income. This applies to certified startups, technology park residents, and higher education institutions.
Deductible expenses include employee salaries, social insurance premiums, raw materials for testing, certification services, and equipment depreciation. The 1.5 coefficient does not apply to transactions between related parties.
