Baku: Netflix and eBay, along with several other international digital service providers, have registered for tax purposes in Azerbaijan, as part of the country's new regulations on taxing the digital economy. From September 1, Azerbaijan will implement a new mechanism requiring non-resident e-commerce platforms providing electronic services to individuals not registered with Azerbaijan's tax authorities to register electronically if their annual turnover exceeds the manat equivalent of USD 10,000.

According to Azeri-Press News Agency, the State Tax Service has been proactive in ensuring a smooth transition to the new rules, engaging in information and communication activities with affected e-commerce platforms. The registration process is currently in progress, with updates on registered companies made available on the State Tax Service's official website. The new tax mechanism targets electronic services rendered to individuals not registered with the tax authorities, with VAT on these services to be paid by the non-resident providers to the state budget.

Businesses using digital services for commercial purposes must provide their taxpayer identification numbers (TINs) to avoid VAT charges from non-resident platforms. Instead, these businesses will calculate and remit the appropriate VAT directly to the state budget. The scope of covered electronic services includes downloads of electronic books, music, audio-visual content, virtual games, software, and internet advertising, as defined by recent legislation.

The State Tax Service reported that four more international companies have recently registered for tax purposes through its electronic portal. These include U.S.-based Anthropic, PBC, Aghanim Inc., Switzerland's eBay Marketplaces GmbH, and Netherlands-based Netflix International B.V. Their registration for VAT compliance will become effective on September 1, 2026.