Azerbaijan has unveiled an unprecedented tax incentive package designed to attract Indian tech companies.

In partnership with the Innovation and Digital Development Agency (IDDA), the government has introduced a 10-year “tax haven” status for residents at its Technopark.

Technopark residents will enjoy a 0 per cent personal income tax on monthly salaries up to $4,700, with a nominal 5 per cent tax levied above this threshold. Additionally, corporate tax, property tax, land tax and tax on dividends will be exempted.

Companies must be operational for at least a year to get the incentives. They must employ more than 10 full-time staff (including two IT specialists) or generate revenue exceeding 200,000 Azerbaijani Manat. (1 Manat equals 49.39 rupees).

The government has also streamlined migration processes for ICT specialists and senior executives, offering work permit exemptions and comprehensive relocation assistance. This includes support for residency permits, office space acquisition and lodging arrangements.

“We are warmly welcoming Indian tech companies to join our thriving ecosystem,” said Pasha Aliyev, regional VP of soft-landing at IDDA. “Our agency offers not only financial incentives but also a gateway to the vast Eurasian market and an opportunity to be part of Azerbaijan’s rapidly growing IT landscape.”

The initiative aligns with Azerbaijan’s Vision 2030, which prioritises digitalisation, tech entrepreneurship and innovation ecosystem development. The government’s commitment to IT is evident in its annual expenditure of over $400 million on digital initiatives in the government centre alone.

The IDDA has been instrumental in driving digital transformation in Azerbaijan.

Its projects include the development of the “mygov” platform, which facilitates citizen interactions with state bodies and the paperless government initiative, aimed at streamlining inter-governmental document exchange.

Azerbaijan’s initiative comes at a time many tech hubs are facing economic challenges.