In 2017, Russia was the first country among CIS1 and EAEU2 member states to introduce a VAT regime on B2C electronically supplied services (ESS), followed by Belarus in 2018, Uzbekistan in 2020 and Tajikistan in 2021. Meanwhile, in 2019, Russia expanded its B2C ESS regime to also apply to B2B transactions. As a result of such changes, technically, foreign suppliers of ESS are now required to directly register for all tax purposes in Russia, and to collect, report and pay Russian VAT (in Russian rubles) on ESS-related revenues.
Earlier this year, Ukraine and Kazakhstan introduced VAT regimes on B2C ESS, effective 1 January 2022. Russia is also about to adjust its 2019 VAT regime on B2B ESS. This article summarizes the recent key VAT developments related to taxation of e-services and digital economy in Russia, Ukraine and Kazakhstan.