Elgun Jalalzadeh
NANO ICT
https://orcid.org/0000-0003-4391-3769
calalzadelgun00@gmail.com
The Impact of Government Support Programs on the
Development of Small and Medium-Sized Entrepreneurs
Abstract
Small and medium-sized enterprises (SMEs) constitute one of the cornerstone pillars of the modern economy, playing a critical role in fostering economic development, increasing employment, promoting innovation, and enhancing market competition. Experience from developed countries demonstrates that well-designed government regulatory policies and targeted support mechanisms create favorable conditions for the accelerated development of SMEs. Such mechanisms include tax incentives, subsidies, facilitated access to credit resources, promotion of innovative businesses, and optimization of the legislative framework.
In Azerbaijan, the primary support mechanisms for SMEs are implemented through the Small and Medium Business Development Agency (KOBİA), which provides entrepreneurs with comprehensive opportunities in training, legal and consulting services, innovation, marketing, and financial support.
In recent years, Azerbaijan has undertaken measures such as transitioning tax rates to a proportional system, reducing VAT, lowering social security contributions, and implementing a simplified taxation system for SMEs. Tax incentives provide for full or partial exemption of taxpayers, extension of payment deadlines, and optimization of the tax base. Looking ahead, key priorities include fostering a competitive business environment, strengthening the rule of law, and ensuring equal competitive conditions for SMEs. Limited access to financial resources remains a significant barrier; therefore, the full and effective implementation of the recent reforms is of strategic importance.
Keywords: local, business, entrepreneurship, subsidy, production