Apply Azure SQL database free offer via Terraform
AFAIK, it's not possible to apply the Azure SQL free offer via Terraform. The Apply offer option is currently only available through the Azure Portal UI, and there’s no exposed parameter or API in ARM, Bicep, or Terraform to enable it programmatically.
You can, however, deploy a serverless Azure SQL Database using Terraform and then manually apply the offer once through the portal. Once applied, the offer remains active for the lifetime of the subscription (within usage limits), and you can continue to manage the database using Terraform.