GOVERNMENT BUDGET REVENUES IN AZERBAIJAN:
THE TAX BURDEN AND THE ROLE OF THE OIL FACTOR

Ilkin ASLANOV


Ilkin Aslanov, Ph.D. Candidate at the Department of State Economic Regulation at the Academy of Public Administration under the President of the Azerbaijan Republic (Baku, Azerbaijan)


ABSTRACT

This article examines the two main sources of the state budget in Azerbaijan: taxes and oil revenues. In particular, it analyzes variously measured indicators of the tax burden on the Azerbaijan economy compared to other countries in the region and the world, assesses, based on a regression model, the role of the oil factor in generating revenue for the budget, and explores various scenarios for evaluating the sustainability of government budget revenues in the medium term. Based on his assessments, the author shows that steady growth of the non-oil sector by 7%-9% per year is a major condition for maintaining the stability of government revenues in the medium term.

Keywords: government budget, tax burden, oil factor, scenario analysis.

Introduction

Depending on the range of functions assumed by the state, its fiscal policy can have a significant effect on the allocation of resources in the economy. On the one hand, the state uses taxes and government budget spending for active intervention in the distribution of income and thus performs its social function in reducing income inequality between different groups of the population, and.


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