Azerbaijan Mortgage and Credit Guarantee Fund exempt from tax liabilities

Trend:

Azerbaijan's President Ilham Aliyev has today signed a decree on additional measures to modernize the activity of the Azerbaijan Mortgage and Credit Guarantee Fund.

The document was signed with the aim of improving population's provision with housing, increasing opportunities to get mortgage loans, and minimizing the risks of mortgage and credit and guarantee mechanisms.

Under the decree, the Cabinet of Ministers was instructed to prepare within a month proposals to exempt the Fund from tax liabilities, as well as to exempt authorized banks and borrowers from tax obligations when the Fund makes payments on guarantees.

Furthermore, the Cabinet together with the Fund should define volume of the funds that will be needed to grant subsidies in 2019-2021 for loans issued since Jan. 1, 2018.

Under the decree, the Fund will also be able to purchase residential areas and lease them.

The Fund should also ensure creation of a special reserve fund to cover possible financial losses.

Azerbaijan's Financial Markets Supervisory Authority (FIMSA) was instructed to define and within three months to submit to the head of state special economic regulations and requirements to ensure banks' active participation in mortgage lending and in activity of the credit and guarantee system.

The decree also eliminates the Fund's authority to determine the limit on subsidies for each authorized bank.