Foreigners to enjoy tax-free in country
Soon, while coming to Azerbaijan on a tourist visa, tourists can take advantage of Azerbaijan's tax- free system. Tax-free shopping used in many countries will soon be fully available in Azerbaijan after the adoption of the law in the Parliament.
Tax-free in Azerbaijan will give foreigners an opportunity to get a refund of VAT after returning home.
This system will make shopping in Azerbaijan more affordable and attractive for foreigners.
Deputy Minister for Taxes Sahib Alakbarov said that currently the system is applied in test mode.
“The Taxes Ministry and the Finance Ministry for a long time have been working on the introduction of tax-free in Azerbaijan. The preparatory work has been finalized and the necessary documents prepared and submitted to the relevant authorities. Test mode is underway for several days. I believe that in the near future after the adoption of the relevant law by the Parliament, we will start a full-fledged application of the system,” Alakbarov emphasized.
For now, more than 70 shops in the country and Baku’s Heydar Aliyev International Airport apply tax-free. Soon the system is expected to operate in the country’s other airports including in Lankaran, Nakhchivan, Ganja and Gabala.
To use the Tax Free system in Azerbaijan, the value of goods purchased at one electronic invoice shall not be less than 300 manats ($200) including the value added tax (VAT).
The goods should be exported from the country within 90 days of the date of purchase. VAT payment is returned back only in this period.
The VAT rate for all goods is set at 18 percent in Azerbaijan. Thus, 20 percent of VAT amount will be deducted as the payment for services, and the other 80 percent will be refunded to the applicant.
To benefit the tax-free service it is necessary to buy tax-free goods at specific Tax
Free shops. Then, passport is to be produced for filling an electronic tax invoice. The signed and stamped tax invoice will include the amount of the paid VAT and its last return date.
When leaving the country, a visitor should present to airport customs his electronic tax invoice together with passport. Finally, the custom’s tax invoice should be presented to an authorized bank. The refund can be made both in cash and non-cash (after 10 days) way.
Tax-free does not apply to the following products: excisable goods; foodstuffs; medicines and medical equipment; items which are of particular value to the preservation of cultural heritage and is considered the country's cultural and historical value; products, the sale of which is exempt from VAT in the country; goods which requires a license for export; frameless, raw or ungraded precious stones; precious metals in the form of ingots; goods exported from Azerbaijan without accompaniment; vehicles and spare parts; goods exported by mail service or Internet.
The system is not applied for Azerbaijani citizens, persons under 14 years, stateless persons and foreigners who have obtained a permit for temporary or permanent residence in Azerbaijan or get a work permit for paid employment as well as persons who are crew members of Air Transport, performing direct duties.