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In the News

Azerbaijan could lower threshold for duty-free e-commerce

September 09, 2015

Azerbaijan has offered to reduce the maximum threshold for duty-free e-commerce.

The discussion on reducing the maximum exemption from customs duties is ongoing, Head of the Azerbaijan State Customs Committee Aydin Aliyev said on September 8.

Today, goods imported through the international postal traffic or transport and courier services that do not exceed a value equivalent of $1,000 per individual for 30 days are exempt from customs duties.

However, until November 2013, the value of goods falling under the exemption could not exceed $200.

“We have offered to implement the rules of buying mobile phones on electronic trading platforms. This is not just a problem of Azerbaijan. During the meeting of the heads of customs services of the CIS countries, Russia also put forward a similar proposal. This shows that e-commerce has a great influence on the turnover of many countries,” said Aliyev.

Besides, he said, due to a decrease in oil prices in world markets, the state budget of Azerbaijan for 2016 is drafted to account for an oil price of $50 per barrel, which imposes a great responsibility on the customs.

“Implementation of the forecast revenue from customs duties is our duty. However, there are certain difficulties. For example, goods from CIS countries within the framework of the agreement ‘On free economic zone’ are not subject to customs duties, some goods are exempt from VAT. All this creates certain difficulties,” he added.

According to Aliyev, the State Customs Committee will make every effort to adhere to the forecast for revenues in the budget in 2016.

Meanwhile, e-commerce continues to grow in Azerbaijan. The State Statistics Committee of Azerbaijan reported that in the first half of 2015, Azerbaijan’s volume of e-commerce increased by 1.9 times and amounted to 6 million manats ($5.72 million).

Most of the goods – 93 percent – were purchased in online facilities in commercial networks owned by legal bodies and individuals purchased the remaining 7 percent.

Last year, the volume of e-commerce in the Azerbaijani market increased by 2.4 times and amounted to 6.4 million manats ($6.1 million).

Today, Azerbaijan is only just finishing the first phase of e-commerce implementation with major pioneer merchants offering at least some products and services online.

In the second phase, an increase in the number of complex e-commerce solutions will likely be made available, including such services as online ticketing, food ordering, etc.

The third phase presupposes these complex services will become expected by society. Consumers will start demanding that a company offers its product or service online. In turn, merchants will expand their offerings and improve already existing services.

At the final stage, it is expected that e-commerce will form a sizeable percentage of the country’s economy.

With such a pace, e-commerce will become one of the most important trends in the Azerbaijani economy in the next few years.

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