Baku, September 16, 2025
Azerbaijan expects to collect 2.57 billion manats in personal income tax in 2026, a 29% increase compared to this year, according to economist Eldaniz Amirov.
He explained that the surge is not driven by wage growth, new jobs, inflation, or rate changes alone. Instead, the main factor is the expiration of a seven-year tax exemption introduced in 2019.
That measure had exempted salaries up to 8,000 manats in the non-oil, non-state sector from income tax.
Starting January 1, 2026, those earnings will once again be subject to taxation. The move is expected to significantly boost budget revenues but also raise the tax burden on affected employees.
The original exemption was designed to stimulate employment in the non-oil economy, a goal the government considered critical in diversifying beyond hydrocarbons.
