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Azerbaijan VAT on digital services

The Azerbaijan Ministry of Economy State Tax Service introduced Value Added Tax liabilities on non-resident providers of digital services to consumers on 1 January 2017. Currently, there is not an obligation to VAT register as the government has opted to use a VAT Withholding Tax.

Payment providers Withholding VAT

Azerbaijan has imposed a Withholding VAT on individuals’ payments of the tax element of payments made to non-resident providers.

The current VAT rate in Azerbaijan is 18%, and must be split from the payment via payment providers. This includes credit card merchants, banks, payment e-wallets and others. This excludes payments for hotels and aeroplane bookings.

What e-services are liable to VAT in Azerbaijan?

Income from the following services is liable to VAT at 18%

  • Telecoms data and voice
  • TV and radio broadcasting
  • Gaming and games of chance
  • E-learning
  • Apps
  • SaaS or cloud-based software
  • Streaming or download software
  • Online storage
  • Advertising

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Asia Pacific VAT on digital services

Comments (click for details) Rate Date Threshold Comments
Australia 10% Jul 2017 AUD $75,000
Azerbaijan 12% Jan 2017
Armenia 20% Jan 2022 AMD 115million
Bangladesh 5% - 15% Jul 2019 B2B and B2C
Bhutan 7% Jul 2021 Nu 5million
Cambodia 10% Mar 2022 KHR 250m
China 6%-13% N/a Nil Withholding VAT; B2B and B2C
Fiji 9% TBC FJD 300,000
India 18% Jul 2017 -
Indonesia 11% Aug 2020 IDR600m or 12k customers
Japan 10% Oct 2015 JPY 10 million
Kazakhstan 12% Jan 2022 Nil
Kyrgyzstan 12% Jan 2022 Nil
Laos 7% Feb 2022 LAK 400m
Malaysia 6% Jan 2020 RM500,000
New Zealand 15% Oct 2016 NZD 60,000
Pakistan 2% Sep 2021 Nil Marketplace Withholding VAT
Philippines 12% TBC P 3million
Singapore 7% Jan 2020 S$ 100,000
South Korea 10% Jul 2015 Nil
Taiwan 5% May 2017 NTD 480,000
Tajikistan 18% Jan 2021
Thailand 7% Sep 2021 1.8m Baht
Uzbekistan 15% Jan 2020 Nil
Vietnam 10% Dec 2020

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