Registration is currently optional for taxpayers.
Azerbaijan on June 1, 2024, launched a registration portal for complying with its value added tax (VAT) regime on cross-border provision of digital services.
As Azerbaijan requires local financial institutions to withhold VAT on purchases of digital services made by consumers in Azerbaijan, the registration is currently optional for taxpayers. The tax authorities have also clarified the following points:
These clarifications are explicitly mentioned in draft amendments to the regime that will be discussed in the fall session of the country’s parliament. The tax authorities are not expected to issue any further general instructions. Instead, they would prefer to engage directly with taxpayers who opt for any “post-registration” instructions. They are exploring ways and methods to encourage voluntary registration by studying the practices of other countries through bilateral discussions and international organizations.
For more information, contact a KPMG tax professional:
Philippe Stephanny | philippestephanny@kpmg.com
Chinedu Nwachukwu | chinedunwachukwu@kpmg.com