Baku: Starting next year, electric motor vehicles in Azerbaijan will be subject to value-added tax (VAT), as announced by the Chairman of the State Customs Committee, Shahin Baghirov. This announcement was made during the discussion of the draft law ‘2026 State Budget Envelope of the Republic of Azerbaijan’ at a session of the Milli Majlis (Azerbaijani Parliament) Committee on Economic Policy, Industry, and Entrepreneurship.

According to Azeri-Press News Agency, Shahin Baghirov explained that the revenues generated through customs typically stem from import operations, with customs tariffs being applied during the import process. He emphasized that much of the budget revenue is formed from VAT. While electric vehicles have been exempt from VAT for over five years, this exemption is set to be canceled. Baghirov highlighted that during the first 10 months of 2025, 1,760 electric vehicles were imported into Azerbaijan, a significant drop from 3,027 units in 2024, indicating a decline in public interest in electric vehicles.

Baghirov further noted that the implementation of VAT on electric vehicles may positively influence local electric vehicle production, suggesting potential growth in the domestic market. The change in policy reflects a strategic shift in Azerbaijan’s approach to balancing import operations with local industry development.